MUMBAI: After starting on a weak note, the bench mark Bombay Stock Exchange (BSE) index, the Sensex today plunged down by a huge 938 points or 1.9%, to close at 47,409.93. Following suite, the National Stock Exchange (NSE) index the Nifty also closed down by 271 points, or 1.9%, at 13,968.

Although there are many factors that impacted the steep fall, like weak global markets, negative foreign flows, uncertainty about the Union Budget and scheduled derivatives expiry, however a strong selling pressure from foreign funds dragged the key indices down. According to estimates foreign funds have possibly sold stocks to the tune of Rs Rs 1,700 crore on Wednesday.

The data on the BSE data shows that Wednesday’s slide have eroded investors wealth by Rs 2.7 lakh crore with the BSE’s market capitalisation at Rs 189.4 lakh crore, from its all-time high of about Rs 199.02 lakh crore that was touched when the Sensex had touched its all-time high 50,000 mark on January 21 and the Nifty too had scaled the key level of 14,700 for first time ever at 14,738.

Just in the last four sessions the Sensex has taken a hit of a massive 2,915 points to 47,269 (intraday low) from record high of 50,184 (intraday high) on January 21 and an estimated Rs 9.39 lakh crore worth of investors wealth has been eroded.

The Nifty is also close behind with a crash of 824 points against its all-time high of 14,753 scaled on January 21.

The selling pressure on BSE was so heavy that our of the 30 Sensex stocks nearly 25 led by Reliance Industries, HDFC Bank and HDFC closed lower while only five ended with gains, namely ITC, Tech Mahindra and HCL Tech,

A analyst at a leading stock brokerage firm said that, the pre-budget caution and profit booking after a major rally like the once experienced in recent times when the Sensex hit the 50,000 mark last week is not a unknown factor however a consistent selling by Foreign portfolio investors (FPIs) was defiantly a major reason why the markets are dragging down. He said that the downward trend is likely to continue for the rest of the weak.

"The selling pressure was so strong that apparently investors even disregarded the IMF projection of  an double-digit GDP growth for India for 2021," the analyst added with a advise for investors, especially retail investors to be extra cautious and trade with stop loss on their trades.