Sensex drops 244 points on weak eco data, Fed caution

HDFC, TCS, RIL, ITC and ICICI Bank dragged the Sensex by over 100 points

Benchmark share indices ended lower on Monday recording their highest single day fall since August 8 after sluggish July domestic industrial growth and weaker-than-expected economic data from China raised concerns over slowdown among the world's largest economies. Further, investors also turned cautious ahead of the US Federal Reserve's two-day policy meet which begins on Tuesday.

The 30-share Sensex ended down 245 points at 26,816 and the Nifty gave off 63 points to close at 8,042.

Even as the benchmark indices slipped by nearly a percent each, there was no sign of weakness in the broader markets. The smallcap index rallied by 0.6% and the midcap index was up 0.1%, continuing its outperformance.

Rupee

The Indian currency fell to as much as 61.11, the lowest since Aug. 14 in intra-day trades today. The fall was in keeping with weaker emerging Asian currencies. However, at 1530 hrs, the rupee was quoting at 61.05 to a Dollar.

Sectors & Stocks

On the sectoral front, Healthcare and Realty were the only pockets to close in green with gains of 0.2% and 0.04% respectively.

Oil & Gas, Metal, Capital Goods and Consumer Durables indices down 1-2% were the sectoral draggers.

Metal shares declined on weak Chinese economic data. China's factory output grew at the weakest pace in nearly six years in August raising fears the world's second-largest economy may be at risk of a sharp slowdown.  Hindalco, Tata Steel and Sesa Sterlite down 1.7-3.3% were among the top Sensex losers.

State-owned bank shares are in focus and trading higher by up to 4% in an otherwise weak market after Raghuram Rajan's comment on appointment process in state-owned banks. Andhra Bank, Allahabad Bank, IDBI Bank, Dena Bank, Corporation Bank and Indian Bank gained 2-4%.

ONGC, HDFC, TCS, Sun Pharma, Axis Bank, M&M, GAIL, RIL and L&T were some of the other notable losers.

Meanwhile, Cipla, Hero MotoCorp, HDFC Bank and Dr Reddy's up 0.4-2.5% were the only gainers among Sensex-30.

In individual names, Mastek rallied 16% to Rs 272, also its 52-week high on National Stock Exchange, after the company said it will demerge its insurance products and services business into a separate listed company.

Lupin moved higher by 4% to Rs 1,416, on media reports that the pharmaceutical major is in advanced talks to sign a blockbuster deal with Merck  Serono.

RPP Infra Projects surged over 7% to Rs 92 after the company today announced that it has received rural electrification orders worth Rs 55.20 crore.

Fortis Healthcare surged 6% to Rs 129 after the company said decided to divest entire stake in healthcare service provider RadLink-Asia and its arm RadLink Singapore to Medi-Rad Associates for SGD 137 million (over Rs 655 crore).

Snowman Logistics was locked in upper circuit of 5% at Rs 82.65, extending its 70% surge on listing day, after mutual fund and high net worth individual bought more than three percent stake in the company through open market on Friday.

Yes Bank dipped over 5% at Rs 600 after the Reserve Bank of India (RBI) on Friday said the foreign investors will need the central bank's approval to buy additional equity in the private sector lender.

Global Markets

Stock markets fell on Monday after China's factory output grew at the weakest pace in nearly six years in August, while worries over the impact of another round of sanctions on Russian projects added to headwinds for Moscow-listed companies and the oil market.

Among the Asian markets, Straits Times and Hang Seng down 1% each were teh top losers while Nikkei and Shanghai Copmposite bucked the trend.

In the European market, FTSE and CAC were down 0.3% each while DAX was flat with a positive bias.