Sensex drops by 141 points, pharma stocks nosedive

Equities wiped out early gains on Monday as selling pressure in the closing hour weighed in across the board.

The BSE S & P Sensex closed 141 points lower at 37,532 while the Nifty 50 was down by 48 points to 11,126.

Except for media and private bank, all sectoral indices at the National Stock Exchange (NSE) were in the red. Nifty pharma fell by 3.3 per cent, metal by 2 per cent and PSU bank by 1 per cent.

Among stocks, Aurobindo Pharma slid by 19.16 per cent after reports that it has received adverse observations from the US Food and Drug Administration. The federal agency indicated procedural lapses along with the lack of quality control after inspecting Aurobindo's unit 7 between September 19 and 27.

Edelweiss Financial Services dropped by over 7 per cent to Rs 78.50 after rating agency Crisil downgraded the rating of its long-term debt instruments of ECL Finance to AA- from AA.

Bharat Petroleum Corporation closed 4.8 per cent lower after the government cleared the way for its privatisation. The other prominent losers were ONGC, JSW Steel, Tata Steel, Tata Motors, and Cipla.

But Yes Bank gained by 7.6 per cent to close at Rs 45.35 per share after it lodged a complaint with Mumbai Police and Cyber Cell against the dissemination of fake news and spread of rumours about the bank's financial health on social media platforms.

The private lender's stock has lost about 80 per cent this financial year but its management says the decline does not reflect the bank's fundamentals.

Meanwhile, Asian shares were mixed after data showed that the US unemployment rate fell to 3.5 per cent in September to reach the lowest since December 1969.

That eased concerns of a slowdown in the world's largest economy as investors main focus shifted to the high-level US-China trade negotiations expected in Washington on October 10 and 11.

MSCI's broadest index of Asia-Pacific shares outside Japan rose by 0.18 per cent while Japan's Nikkei stock index opened higher but reversed course and fell by 0.16 per cent. South Korea's Kospi was up marginally but Hong Kong's Hang Seng fell by 1.1 per cent.