Stocks slipped back into the red today with the Sensex falling almost 148 points to 31,661.97, tracking global sell—off on lingering worries about North Korea and the rupee hitting three—week low against the dollar.

The rupee dropped to a low of 64.26 per dollar (intra— day), its weakest level since August 16, on sustained foreign fund outflows despite a weak dollar overseas.

After opening lower at 31,713.50, the 30—share Sensex slipped further to touch a low of 31,586.53.

A rally in Reliance Industries and Kotak Bank helped the index recover some of the losses and finally settle at 31,661.97 points, still down by 147.58 points or 0.46 per cent. The index had risen by 107.30 points yesterday on bargain buying.

The NSE Nifty remained in the negative terrain through the session and cracked below the 9,900—mark at one stage to hit a low of 9,882.55. It recovered partially to close with a loss of 36 points, or 0.36 per cent at 9,916.20.

Investors booked profits in recent gainers dragging the indices into losses, brokers said. The 30-share index had gained 107.30 points in the previous session.

Among major losers, Sun Pharma, ITC, Lupin, Axis Bank, Adani Ports and Bajaj Auto fell up to 3.73 per cent.

Global shares fell and the dollar dipped against the Japanese yen on Wednesday as still-simmering tension over the Korean peninsula kept investors wary of taking on risk.

European and Asian shares dropped after the S&P 500 suffered its biggest one-day fall in three weeks on Tuesday as US investors sold in reaction to North Korea's sixth and biggest nuclear weapons test on Sunday.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.5 percent and Tokyo's Nikkei hit a four-month low and closed down 0.1 percent. South Korea's KOSPI index ended down 0.3 percent at a near four-week low.

European shares opened lower. The pan-European STOXX 600 index fell 0.3 percent, with an index of banks losing 0.5 percent.

North Korea's nuclear test on Sunday comes at a time when foreign investors were reducing their holdings in Indian shares, having sold a net $2 billion in August and $248.70 million so far in September, according to clearing and exchange data. They remain net buyers of nearly $7 billion so far this year.

Foreign investors, however, were net buyers of Indian debt last month, and have been modest net sellers so far this month.

“Global uncertainty around North Korea is definitely affecting the markets,” said Dhananjay Sinha, Head of Research, Economy and Strategy at Emkay Global Financial Services.

“(Share) market valuations are also fairly stretched at the moment and these global cues will certainly influence the market given that global inflows are important. So, we are not insulated to all these global factors.”

Investors turned to safe-haven investments like gold, silver, Treasury futures and Japanese yen amid growing global tensions.

The Nifty FMCG index fell 1.34 per cent, after closing 0.2 per cent higher in the previous session.

Cigarettes-to-biscuits maker ITC Ltd clocked three straight session of falls, losing as much as 2.56 per cent. Brokerage Jefferies downgraded the stock to “hold” and also cut the target price, citing regulatory uncertainties leading to pressure on volumes and earnings growth.

Energy shares, however, gained even as global oil prices dropped on subdued crude demand following hurricanes that hit the U.S. Gulf coast and the Caribbean forcing refinery closures.

Reliance Industries Ltd inched up 0.71 per cent.

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