Mkts recover despite dismal GDP data; close 94 pts lower

The monthly derivatives expiry that happened today also contributed to helped the market recover from the 226-point loss it registered during the day.

The rupee, which slipped to a record low of 56.50 to a dollar, also staged a comeback of sorts and was last trading at 56.06 as compared to 56.24 yesterday.

After the release of GDP data, Finance Minister Pranab Mukherjee said the government will take necessary steps to improve growth. By the evening, the Finance Ministry announced a slew of austerity measures to cut government expenditure.

The economic growth rate slowed to a nine-year low, both in the March quarter at 5.3 per cent as well as in 2011-12 at 6.5 per cent.

The recovery in stocks was also helped by a firm opening in European stock markets on the back of better-than-expected German retail sales as well as French consumer spending data.

"Rupee showed some strength against dollar. Nifty recovered from lows. Stronger European markets also lifted the sentiments," said Inventure Growth and Securities Head Research Milan Bavishi.

Tata Motors, which lost 11.8 per cent yesterday, was again the worst performer in Sensex today shedding 4.17 per cent, followed by ICICI Bank (4 pc), Maruti (3.86 pc) and Jindal Steel (2.57 pc).

"We think RBI will likely ease its hawkish stance in the forthcoming monetary policy...More leeway to cut rates should arise; we expect another 75-100 bps Repo rate cuts by RBI in FY13," said Deepali Bhargava, Chief Economist, Espirito Santo.

The 50-share NSE Nifty closed lower by 26.50 points, or 0.54 per cent at 4,924.25, after touching the day's low of 4,883.55. (MORE)