The equity market closed with heavy losses on Wednesday as the 30-share BSE Sensex finished at 60,098.82 down 656.04 points, or 1.08%, from the previous closing mark. The broader 50-share NSE Nifty also lost almost 1% to close at 19.938.

The markets were dragged down by stocks of information technology companies as treasury yields in the United States hit two-year highs. Shares of major IT companies like HCL Tech, Tata Consultancy Services, Wipro and Infosys lost in the range of 1.7% to 2.7% on the BSE.

“The hardening of US yields has fuelled fears of a higher-than-expected Federal Reserve interest rate hike, which has seeped through to Indian markets and triggered consolidation after a solid run,” Aishvarya Dadheech, fund manager at Ambit Asset Management told Reuters.

Higher US yields and interest rate hikes tend to make investments in equities in emerging markets like India less attractive, leading to an outflow of foreign funds.

The Nifty IT sub-index lost 2.13% overall, while the sub-indices for fast-moving consumer goods and financial services sectors also lost more than 1% each. Shares of automobile and public sector banks gained the most.

State Bank of India, Maruti, Tata Steel and Mahendra & Mahendra were among the top gainers in Tuesday’s trading.