ONGC, Sesa Sterlite, Tata Steel, RIL and HDFC emerged as the biggest losers
The Sensex posted its seventh biggest single-day fall in history, amid weak global cues, after the sharp fall in global crude oil prices raised worries over global growth slowdown and the political uncertainty in Greece also weighed on market sentiment.
The 30-share Sensex ended down 854.86 points or 3.1% at 26,987.46 and the 50-share Nifty ended down 251.05 points or 3% at 8,127.35.
On July 6, 2009, the Sensex had slumped 869.65 points while the Nifty had ended 258.55 points lower.
In the broader market, both the BSE Midcap and Smallcap indices ended largely in-line with the front-liners with losses of around 3% each. Market breadth in BSE ended heavily neagtive with 2,253 declines against 644 advances.
Oil prices slumped to new 5-1/2-year lows on Monday on worries about a surplus of global supplies and lacklustre demand. The two crude oil benchmarks - Brent and U.S. light crude, also known as West Texas Intermediate - have now lost more than half of their value since mid-2014.
Globally traders also turned risk averse over apprehensions of Greece defaulting on its loans and losing its status as a Euro zone country which became more pronounced with the leftist Syriza party, committed to roll back austerity measures, emerging as the front-runner for the January 25 election.
Domestic factors too weighed on sentiments as analysts expect the BSE Sensex companies to report a flat net income growth on a year on year basis in the third quarter with metals and real estate companies pulling down the earnings of Corporate India.
India's HSBC PMI for services was down to 51.1 points in December against 52.6 points in November. Though, the services sector has shown growth since October when the PMI reading was 50, indicating stagnation, the pace was slower in December compared to the preceding month.
Meanwhile, foreign institutional investors were net buyers in Indian equities worth Rs 472 crore on Monday, as per provisional stock exchange data.
All the 12 sectoral indices ended in red with losses around 1.4% to 4.2%. BSE Oil & Gas index, down 4.2% ended with highest losses followed by BSE Realty, BSE Metal and BSE Capital Goods indices closing down 3.6%, 3.5% and 3.2% respectively. BSE FMCG index, down 1.4% lost the least.
22 out of the 30 constituents of Sensex ended with losses over 2%. HUL was the sole gainer in the Sensex and gained around 2% after Deutsche bank upgraded the stock to "buy" from "hold."
Coal India ended flat. The five-day strike announced today by the Coal India union is likely to have a cascading effect on the country’s power sector.
Bank stocks remained under pressure on the absence of any significant reform centric announcements during the two-day banking conclave which was held in Pune and attended by Prime Minister, RBI Governor and top officials from the banking and insurance sector.
Mortgage lender HDFC declined the most among financials and ended down by 4.7%. ICICI Bank lost around 4.2%. Axis Bank lost over 3.5% while SBI ended down around 4%.
Metal stocks were under pressure. Hindalco lost around 2.5% while Sesa Sterlite and Tata Steel lost over 5% each.
Oil shares were under pressure as crude oil prices plunged to fresh 5-1/2-year lows on rising concerns about a surplus of global supplies and lacklustre demand. GAIL declined 3.2% while RIL and ONGC lost around 5% to 6% each.
BHEL and Tata Motors declined over 4% while Hero Motocorp, L&T, NTPC ,TCS and Tata Power lost over 3%.
Bharti Airtel lost around 1% on concerns about the cost of acquiring mobile phone airwaves at the government auction as the Union Cabinet on Monday finalised the reserve prices for the 800-, 900- and 1,800-MHz telecom spectrum bands and said the 2,100-MHz band would be auctioned simultaneously with the other bands in February.
Among Asian markets, Japan’s Nikkei dropped 3%, its largest fall in almost 10 months as uncertainty surrounding Greece's future in the euro zone and slumping oil prices dampened risk appetite, while a stronger yen hit exporters' shares. Hang Seng index ended 1% lower while Shanghai Index closed flat.
European markets have opened lower tracking overall weak global sentiments. CAC 40 and FTSE 100 indices have lost 0.2% and 0.7% each while DAX index is marginally down by 0.1%. Despite concerns over political uncertainty in Greece expectations that the European Central Bank could start buying government debt to shore up the economy as soon as this month have kept the losses capped in the European markets.