The Indian markets continued to fall for a fifth consecutive session on Wednesday, as speculation that French government bonds may be downgraded in a stressed economic scenario and domestic worries such as slowing industrial growth and high inflation sapped investor appetite for risk.
However, the benchmark indexes recouped most of their early losses to end off their day's lows as news spread that the Union Cabinet has given its approval for 26 percent foreign direct investment in pensions funds.
The government has approved changes to the Pension Fund Regulatory and Development Authority Bill that will be introduced in parliament for passage in the winter session, reports said.
The benchmark 30-share Sensex fell around 240 points in the afternoon before paring losses to end down 107 points or 0.63 percent at 16,776, while the broader Nifty index closed at 5,030, down 38 points or 0.75 percent from its previous close.
Second-line stocks continued to come under renewed selling pressure, with the BSE mid-cap and small-cap indexes ending down 0.94 percent and 1.34 percent, respectively. Capital goods, power, oil/gas and IT stocks bore the brunt of the selling, while consumer durable, FMCG, metal and realty stocks witnessed stock-specific buying.
Jaiprakash Associates slumped 4.5 percent, extending Tuesday's nearly 6 percent loss. Wipro, Hero MotoCorp, Sun Pharma, Larsen & Toubro and BHEL were the other prominent decliners with losses 2-4 percent.
Tech Mahindra lost 1.5 percent on a brokerage downgrade after the IT services provider warned that there will be a challenge on margins for one or two quarters due to falling European spending.
Shree Renuka Sugars, which reported a huge forex loss of Rs.569.80 crore in Q4, extended declines to end down 4.5 percent after the Indian rupee depreciated to a fresh 32-month low of Rs.50.91 against the dollar in early trading Wednesday.
Everonn Education tumbled 4.4 percent after the education services provider said that Dubai-based Varkey Group's open offer that was scheduled to open on November 16 would get delayed. IOC, BPCL and HPCL fell 2-5 percent after the state-run oil retailers cut petrol prices yesterday for the first time in 33 months.
Jet Airways climbed 4.5 percent, reversing an early loss amid reports that it is exploring options for raising funds to cut debt. Rival Kingfisher Airlines jumped 14.4 percent after its chairman clarified that the company was not seeking a bailout.
Reliance Industries ended down 1.6 percent after the energy giant denied that it was in talks to buy a stake in the cash-strapped airline.
Shares of companies such as Idea Cellular and Power Finance Corporation rose over 4 percent each after they have been added to the MSCI India Index with effect from 1 December 2011. HDIL slumped 4.5 percent, extending recent losses after MSCI excluded the stock from the MSCI India Index.
Tata Motors, India's largest automaker, rose half a percent after the company reported a 10 percent rise in October global sales.
ONGC rose 1.7 percent on a report that its follow-on public offering is unlikely to take off in this calendar year. Andhra Cement jumped 5 percent after the G P Goenka Group sold its controlling stake in the ailing cement company to a privately held unit of the Jaypee Group.
Titan Industries gained 2.9 percent after the company signed a binding agreement to acquire Swiss watch brand Favre Leuba for up to 2 million Euro.
Elsewhere in Asia, the benchmark indexes in Japan, South Korea, Hong Kong and Japan fell between 1 percent and 2.5 percent, as better-than-expected data on U.S. retail sales failed to quell aggravating fears over the deepening European crisis. Concerns that economic growth in China and Japan is slowing also prompted investors to stay on the sidelines as they awaited Italy's progress on forming a new government.
The Bank of Japan today retained its benchmark uncollateralized overnight call rate at around 0-0.1 percent, but downgraded its assessment of the economy, citing adverse effects from the European debt crisis and the appreciation of yen. European stocks rose after a subdued start as Italian and Spanish bond yields fell back from the alarmingly high levels that triggered a wave of selling in the past two sessions.
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Market Analysis
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.