Sensex ends down 370 pts

The Sensex has ended (provisonal) at 16,497 - down 370 points. Nifty ended down 113 points at 4,947.
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(Updated at 1446 hrs)

Markets have made a marginal recovery in late noon deals with the Sensex trading 352 points down at 16,514, while the Nifty is down 110 points at 4,949. The BSE benchmark had touched a low of 16,393 on negative cues from global peers in intraday deals.

A dismal index of industrial production (IIP) data dampened investor sentiments further. Data showed that industrial growth has fallen to a meagre 3.3% in July this year on account of poor performance mainly by capital goods, manufacturing and mining sectors, reflecting sluggishness in the economy. Growth in the factory output, as measured in terms of the Index of Industrial Production (IIP), had stood at 9.9% in July last year.

Most markets across the globe dipped on fears that the Greek government may default on its debts. Worries about France's rating being cut by Moody's also played spoilsport. In Asia, Hang Seng dropped 4.2% to 19,031. Nikkei and Straits Times shed around 2.5% each. In Europe too markts touched 26-month lows. CAC tanked over 3%, followed by DAX and FTSE which were down 1-2% each.

Back home, markets would be looking at the RBI's monetary policy review on Friday and the corporate advance tax payments on Thursday. Analysts believe that the Reserve Bank of India (RBI) would be hiking rates once again as inflation pressures continue to remain strong. An increase would be the 12th in the current cycle and would take the repo rate, the central bank's key lending rate, to 8.25%, where most economists see it staying until at least the end of the fiscal in March.

All the sectoral indices are in the red with the BSE Consumer Durables index skidding 2.8% to 6,528. Metal, IT, banking and realty indices have also dropped over 2% each.

Among individual stocks, ICICI Bank, Reliance and Infosys contributed at least 120 points to the Sensex's fall.

Metal stocks were the big losers in the Sensex pack. Jindal Steel, Tata Steel and Hindalco shed 3-4% each in trades. Bharti Airtel dropped 3% to Rs 388. Among other big losers were Jaiprakash Associates, Tata Motors, Wipro and SBI.

Meanwhile, FMCG heavyweight - Hindustan Unilever, jumped 4.2% to Rs 347. Cipla also bucked trends and was up 1% at Rs 290.

The BSE market breadth remained extremely negative with 1,952 shares on the declining side and 737 on the advancing side. Around 2,770 shares have been traded so far.