Benchmark indices Sensex and Nifty fell for the third day running on Thursday, dragged by continuous selling in HDFC Bank and profit-taking in consumer durables and utility shares.

The 30-share BSE Sensex fell by 313.90 points or 0.44 per cent to settle at 71186.86. During the day, it tanked 835.26 points or 1.16 per cent to 70665.50.

The Nifty declined 109.70 points or 0.51 per cent to 21462.25. During the day, it plunged 286.4 points or 1.32 per cent to 21285.55.

The heavy fall in the markets comes on the back of a recent record-breaking rally. The BSE benchmark hit an all-time high of 73427.59 on Tuesday, and the Nifty also reached its lifetime peak of 22124.15 the same day.

In three days, the Sensex lost 2,141 points or nearly 3 per cent while Nifty retreated by 635 points or 2.89 per cent to fall below the key support level of 21,500 points.

“Investors are trimming bets on rapid Fed cuts due to strong US retail sales and the resulting rise in global bond yields," said Vinod Nair, head of research, Geojit Financial Services.

“Furthermore, oil price advances and rate escalation risks have led to disruptions in global shipping and crude production."

“The broader market continued its selling pressure given the elevated valuation and profit booking with an aim for sector rotation,” Nair said.

LTIMindtree tanks

Shares of IT services major LTIMindtree slid down 10.76 per cent on the Bombay Stock Exchange with the company’s management informing analysts of pushback on its aspiration of 17-18 per cent EBIT (earnings before interest and taxes) margin by a “few” quarters.

The company has reported a net profit of Rs 1,169.3 crore in the third quarter (Q3) of the fiscal, up 0.6 per cent from Rs 1,162.3 crore in the second quarter (Q2) and 16.8 per cent from Rs 1,000.7 crore in the third quarter of the last fiscal.

The EBIT margin in Q3 was 15.4 per cent down from 16 per cent in Q2, but up from 13.9 per cent a year ago. Higher furloughs also impacted profitability.

“Against the backdrop of a continued challenging macroeconomic environment and client decision-making, we expect Q4 performance to remain similar to Q3. Despite experiencing higher-than-anticipated seasonality in Q3, our strong order inflows and the healthy deal pipeline have set the stage for our medium-term growth,” Debashis Chatterjee, MD and CEO of LTIMindtree, said at the third quarter earnings call.

“While our margin optimisation programme continues, we remain committed to investing appropriately to capture growth opportunities because of which our aspiration of a 17-18 per cent EBIT margin will get pushed out by a few quarters,” Debashis Chatterjee, MD and CEO LTIMindtree, said at the third quarter earnings call.

Analysts on Thursday said the Q3 results were below their expectations.

“In Q3, LTIMindtree reported revenue of Rs 9,017 crore, up 1.2 per cent quarter on quarter. This was slightly below our expectations. The company’s operating profit stood at Rs 1,386 crore, reporting a decline of 2.6 per cent quarter on quarter,” Axis Securities said in a note.

“Third quarter EBIT margin declined 60 basis points quarter on quarter to 15.4 per cent, missing our estimate by 40 basis points,” Motilal Oswal said.

“We now expect LTIMindtree to deliver 16.5 per cent EBIT margins in FY25 before crossing the 17 per cent mark in FY26.”