Markets lower on Monday, amid weak global cues, with index heavyweight Reliance Industries [ Get Quote ] leading the fall.
The Sensex ended at 18,709, down 229 points and the 50-share Nifty slipped 71 points to close at 5,676.
Meanwhile, the European markets were trading on a weak note as concerns over the global economic outlook and its impact on the coming corporate earnings season weighed on investor sentiment.
The World Bank cut its estimate for East Asian growth, including for China, and this has undone some of the positive sentiment that followed Friday's sharp drop in US unemployment for September.
The CAC40 index was down 1.2% at 3,418, DAX slipped 1.4% to 7,295. However, the FTSE100 index was trading marginally higher at 5,831 levels.
The Asian markets ended on a weak note.
The Hang Seng, Shanghai Composite and Seoul Composite closed weaker by 0.6-1% each.
Back home, Cautioning that absence of economic reforms will slow down growth, Finance Minister P Chidambaram today said political parties may oppose but should not obstruct decision making.
"Every government is entitled to lay down policies. Opposition to policies is legitimate, obstructionism is not," Chidambaram said while addressing the annual Economic Editors' Conference.
Index heavyweight Reliance Industries was the top Sensex loser.
The plunged 4.6% to Rs 818 after Morgan Stanley cut its rating on the company to 'underweight' from 'equal-weight' due to lack of near-term triggers, expectations for weaker refining margins and valuation.
"Morgan Stanley also cited concerns about Reliance's investments into businesses that offer "low" return-on-equity, as well as a subdued outlook on petrochemicals in a noted on Monday," the Reuters report suggests.
Hindalco Industries [ Get Quote ] ended lower by 3.2% at Rs 121 after Citigroup downgraded the non-ferrous metals producer to 'sell' from 'buy' and cut its target price to Rs 118 from Rs 164. Citigroup says Hindalco has not been immune to macro headwinds or oversupply, and also cites rising costs for fuel/power, slower clearances that are making project economics less viable, and an appreciating rupee among factors behind the downgrade.
BHEL, Larsen & Toubro, State Bank of India [ Get Quote ], Tata Motors [ Get Quote ], Wipro [ Get Quote ], Tata Power [ Get Quote ], ONGC [ Get Quote ], Coal India, Infosys [ Get Quote ], ICICI Bank [ Get Quote ], Hero MotoCorp, TCS [ Get Quote ], Tata Steel [ Get Quote ], HUL, Mahindra & Mahindra, Sterlite Industries and Gail India [ Get Quote ] were also among the losers down 0.3-3.6% each.
On the other hand, Sun Pharma [ Get Quote ] was the top gainer among the Sensex stocks. The stock advanced nearly 4% to close at Rs 709 also its lifetime high market price on the National Stock Exchange.
Last week, the board of directors of pharmaceutical company has approved the proposal of raising up to Rs 8,000 crore (Rs 80 billion) through domestic or international offerings.
Jindal Steel, Bharti Airtel [ Get Quote ], Cipla, ITC, NTPC, Dr Reddy's Lab and HDFC [ Get Quote ] were also among the notable gainers from the heavyweight space.
Selling pressure was visible across the board.
The BSE realty index was the top sectoral loser, down 3.5% or 68 points to end at 1,881.
Oil & gas, capital goods, IT, power, auto, bankex, PSU, metal and FMCG indices also ended weaker by 1-2.7% each.
Shares of Vijay Mallya led UB Group companies such as United Spirits [ Get Quote ], United Breweries [ Get Quote ] Holdings, United Breweries and Kingfisher Airlines were under pressure and trading lower by 3-7% on the Bombay Stock Exchange.
The group will send all its recommendations to the Cabinet, which is expected to take up the matter on October 16, added report.
Shares of telecom companies Idea Cellular [ Get Quote ], Reliance Communications [ Get Quote ], Tata Teleservices [ Get Quote ] (Maharashtra) rallied more than 4% each in an otherwise weak market on TV channel reports that the empowered group of ministers have recommends that the one-time spectrum fee beyond 4.4 MHz would be levied on prospective basis.
Geometric Limited rallied 5% to Rs 123 after the company said that Indian equity investor Rakesh Jhunjhunwala acquired an additional 3.39% stake in the company via open market transactions.
Kingfisher Airlines has hit the lower circuit of 5% at Rs 12.60 for the sixth consecutive trading session, after the aviation regulator - Directorate General of Civil Aviation (DGCA) - issued a show cause notice to the company asking why its permit should not be cancelled or suspended as it had failed to "establish a safe, efficient and reliable service".
The broader markets also ended on a weak note.
The BSE mid-cap index slipped 0.4% at to close at 6,649 and the small-cap index ended weaker by 12 down points at 7,134.
The overall breadth was negative as 1,515 stocks declined while 1,383 advanced.