Domestic equity benchmarks Sensex and Nifty gave up initial gains and settled lower by one per cent on Thursday, September 28, tracking volatility on the monthly F&O expiry and dragged by weak global cues. A massive sell-off in information technology (IT) stocks and select heavyweights including Reliance Industries, ITC, and Infosys also dented market sentiments.

The frontline indices however, had opened in a positive territory driven by strength in metals and bank stocks. But global cues such as high crude oil prices, rising US bond yields and a stronger US dollar limited further gains. These indicators have been weighing on the global equity markets since the US Federal Reserve struck a hawkish tone earlier in the month.

Crude prices, which rose 3 per cent overnight is hurting India, the world’s third-largest importer, which is also reeling under lower-than-expected monsoon rains, triggering inflation risks.