Indian markets opened trading on Thursday in the red in sync with most markets abroad after the US Federal Reserve indicated revoking of stimulus.

A drag from losses in index heavyweights and negative trend in overseas equities weighed on the equity benchmarks. The S&P BSE 30-share Sensex tumbled over 300 points in early trade on Thursday to 52,199.18, while the broader 50-share NSE Nifty shed 93.70 points or 0.59 per cent to 15,673.85.

Tech Mahindra was the top loser in the Sensex pack, losing around 1 per cent, followed by PowerGrid, HDFC, HDFC Bank and Axis Bank. Asian Paints, Sun Pharma, UltraTech Cement and HCL Tech were among the gainers.

The Sensex closed 271.07 points or 0.51 per cent lower at 52,501.98 and Nifty retreated from a record and declined 101.70 points or 0.64 per cent to 15,767.55 at the close on Wednesday.

Foreign institutional investors (FIIs) were net sellers in the capital market with an offload value of Rs 870.29 crore on Wednesday.

Domestic equities do not look to be good as of now due to weak global cues, said Binod Modi, Head of Strategy at Reliance Securities. “While soft bond yields and improving prospects of earnings visibility have resulted in FII flow to turn favourable in the last couple of days, slight hawkish policy meeting outcome of the Federal Open Market Committee (FOMC) may weigh on sentiments in the near term,” he noted.

The Federal Reserve on Wednesday signalled that it may act sooner than previously planned to start dialling back the low-interest rate policies that have helped fuel a swift rebound from the pandemic recession but have also coincided with rising inflation.

In a statement after its policy meeting, the Fed said it expects the pandemic to have a diminishing effect on the economy as vaccinations increase, thereby allowing for more growth. “Progress on vaccinations has reduced the spread of Covid-19 in the United States. Amid this progress and strong policy support, indicators of economic activity and employment have strengthened,” the Fed said.

The American central bank also raised its forecast for inflation to 3.4% by the end of this year, from 2.4% in its previous projection in March. Yet the officials foresee price increases remaining tame in the following two years. That outlook reflects Chair Jerome Powell’s view that the current inflation spikes stem mainly from supply shortages and other temporary effects of the economy’s swift reopening from the pandemic.

On Wall Street, the benchmark S&P 500 index fell 0.5 per cent on Wednesday after the Fed meeting outcome. Asian bourses replicated the trend with Tokyo, Hong Kong and Seoul exchanges going down.

“The Fed may have delivered a more hawkish message for markets than many would have expected,” Yeap Jun Rong of IG said in a report. Still, Yeap said, differing views among board members suggests “much will still depend on how the economic recovery will play out”.

The Nikkei 225 in Tokyo lost 1.1 per cent to 28,965.07 and Hong Kong's Hang Seng was off less than 0.1 per cent at 28,434.62. The Shanghai Composite Index was up 0.2 per cent at mid-morning at 3,525.67. The Kospi in Seoul sank 0.5 per cent to 3,261.05 and Australia's S&P-ASX 200 shed 0.4 per cent to 7,357.90. New Zealand, Singapore and Jakarta declined while Bangkok advanced.

The international oil benchmark Brent crude traded 0.54 per cent lower at $73.99 per barrel early on Thursday.