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Equity benchmarks struggled for direction on Thursday as the week-long rout in Adani Group stocks persisted, erasing $100 billion in market value and hurting sentiment.
The Nifty 50 index closed 0.03 per cent lower at 17,610.40, while the S&P BSE Sensex rose 0.38 per cent to 59,932.24. Thirty of the Nifty 50 constituents fell in a volatile session in which the index swung between 0.2 per cent gains and 1 per cent losses.
The difference in the performance between the two benchmarks is solely due to Adani group stocks. Two of the group companies—Adani Enterprises and Adani Ports and Special Economic Zone—are among Nifty 50 constituents, while both are not part of Sensex.
"The sell-off in Adani stocks has created panic in the markets," said Siddhartha Khemka, head of research (retail) at Motilal Oswal Financial Services.
"Until the Adani saga settles down, there won't be stability in market, especially from the retail investors' perspective," Khemka added.
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Phasing out the revenue deficit is detrimental for economic growth recovery at this junctureAdani stocks extended their slide after the group decided to call off the $2.5 billion follow-on public offering, which was fully subscribed.
The stocks have been facing steep losses since the Hindenburg report on January 24, which raised concerns over the group's financials.
India's market regulator is examining the crash in Adani company shares and looking into possible irregularities in the secondary share sale of flagship Adani Enterprises, Reuters reported, citing a source familiar with the matter, earlier in the day.
Adani Enterprises was the top loser in Nifty 50, tumbling 26.70 per cent, while most of the other group stocks also witnessed a sharp selloff.
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The slide in Adani stocks and financials offset gains in information technology stocks, which rose on dovish commentary from US Federal Reserve after raising the interest rate in line with an expected 25 basis points and said it had turned a key corner in the fight against high inflation.
Fast moving consumer goods index, too, climbed 2.28 per cent, aided by high weightage ITC after the federal budget proposed a lower-than-expected hike in tax on cigarettes
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