The Sensex ended below 17,000 on Friday, after the rupee weakened further against the US dollar and plans to review tax treaty with Mauritius dampened investor sentiment, on selling pressure in banks and index heavyweights.
Banks witnessed selling pressure after Macquarie in a report said, that the RBI directives to meet Basel III regulations could lead to an equity dilution in banks of roughly $30-35 billion over the next five years.
Further, Minister of State for Finance S.S. Palanimanickam told lawmakers on Friday that India is considering a review of the Double Taxation Avoidance Treaty with Mauritius to raise revenues.
The 30-share Sensex provisionally ended down 324 points at 16,827 and the 50-share Nifty closed 106 points lower at 5,082 .
(Updated at 14:38 hrs)
Markets have extended losses in late noon deals, owing to selling pressure in banking and realty shares. The Sensex touched a low of 16,813 and is now trading down 307 points at 16,845. Nifty is down 97 points at 5,091.
Meanwhile, in Asia, markets slipped following a sharp overnight drop in crude oil hitting energy names, ahead of the closely-watched U.S. nonfarm payrolls report. Hang Seng slipped 0.7% to 21,086. Straits and Kospi markets were also down. Wall Street closed with mild losses on Thursday, one day ahead of the key U.S. jobs data for April.
All the sectoral indices, barring healthcare, slipped into red. BSE capital goods index tumbled 3.7% to 8,912. Bankex and realty indices shed 3% each. Meanwhile, the healthcare index remained flat at 6,797.
Heavyweights were the key draggers today. ICICI Bank, Larsen & Toubro and Reliance together accounted for a 105 points fall on the BSE benchmark.
RIL slipped 1.8% at Rs 725. In less than a year of signing the transformational deal between Reliance Industries (RIL) and British Petroleum (BP), analysts say the value of the deep-water blocks held by RIL and BP (in India) is down by over a half.
BHEL slipped 5.4%, followed closely by Hero MotoCorp, Bajaj Auto and DLF. Metal shares declined with Hindalco and Tata Steel dropping 3.5% each.
Meanwhile, Cipla added 2.5% to Rs 325 after the company cut the price of its generic version of Bayer's cancer drug Nexavar by 75% to Rs 6,840 for a monthly dose. Meanwhile, Natco Pharma shed 5.4% to Rs 395 following the news. Natco charges Rs 8,880 for the same drug.
Wipro added 0.6% to Rs 415. HUL was up marginally at Rs 435.
BSE market breadth is negative. Out of 2,798 shares traded, 2,078 shares have delcined while 639 shares have advanced.