Sensex ended 330 points lower at 40,323
Sensex ended 330 points lower at 40,323

Sensex falls over 300 points after hitting record highs for third day

  • Moody's downgrades India's outlook to negative from stable
  • The rating agency also cut its outlook for a clutch of companies

Stock market indices Sensex and Nifty ended lower today after Moody's Investors Service cut India's ratings outlook, flagging domestic growth risks. The ratings agency also cut its ratings outlook for a clutch of companies to "negative", including HDFC Bank Ltd, State Bank of India, Indian Oil Corporation Ltd and Infosys Ltd .

The Sensex ended 330 points lower at 40,323, after hitting a new high of 40,749 during the session - its third new high in three consecutive session. The NSE Nifty 50 index closed down 0.86% at 11,908.15

"Rating downgrade forced investors to book profit in a volatile market and rupee weakened to three-week low. Given the subdued performance of the equity market during the year mutual funds inflows fell to four-month low while premium valuation of large and blue-chips is not attracting new funds in the market," said Vinod Nair, head of research at Geojit Financial Services.

Equity mutual funds received 6,020 crore last month, according to the Association of Mutual Funds in India. That’s 9% less than what they got in September and the smallest inflow since May.

For the week, the NSE index eked out a gain of 0.15%, while the BSE index rose 0.39%. The realty index was the top gainer with a 1.66% rise.

Yes Bank closed up 3.76% and was the top gainer on the NSE index, while Bharti Infratel Ltd was the top loser, posting a 4.9% drop.

"We expect profit-taking to extend further in the index and 11,700 would act as crucial support ahead," said Ajit Mishra, vice president for research at Religare Broking.