Sensex dips 207 pts after initial surge

Indian stocks declined, with the benchmark Bombay Stock Exchange Sensitive Index reversing earlier gains, as selling by overseas funds overwhelmed investor optimism about the US government’s rescue of Citigroup.

Reliance Industries (RIL), the nation’s most valuable company, fell 6.4 per cent. State Bank of India (SBI) , the country’s largest lender, dropped 6.7 per cent, the most in a month.

The BSE Sensitive Index, or Sensex, fell 207.59, or 2.3 per cent, to 8,695.53. The index earlier rose as much as 3.1 per cent. The S&P CNX Nifty Index on the National Stock Exchange declined 54.25, or 2 per cent, to 2,654. The BSE 200 Index slid 1.9 per cent to 1,028.04. Nifty futures for November delivery dropped 2.8 per cent to 2,641.

Overseas funds sold a net Rs 514 crore ($127.4 million) of Indian stocks on November 21, increasing outflows this year to a record $13.4 billion, the nation’s market regulator, Sebi, said.