In their worst single-day fall in over two months, Sensex on Tuesday tumbled 431 points and Nifty tanked 129 points on massive selling by foreign funds and retail investors in bluechips amid weak global cues.
Besides, caution ahead of monthly expiry in the derivatives segment on Thursday saw participants reducing their positions, traders said.
All the sectoral indices led by realty, oil and gas and metal ended in the negative zone with strong profit-taking seen in recent outperforming sectors including banking, healthcare, capital goods, auto and IT stocks.
Selling was heavier in smallcap and midcap stocks with their indices falling up to 2.48 per cent, after posting handsome gains in the previous session.
The 30-share Sensex after remaining range-bound at start, dipped below the 27,000-mark as blue-chip stocks lost ground. Selling intensified largely in tandem with a weak trend in the global markets and it finally settled 431.05 points, or 1.58 per cent, lower to close at 26,775.69.
This is its worst drop since July 8 when Sensex had plummeted 517.97 points.
The 50-share Nifty dropped 128.75 points, or 1.58 per cent, to close below 8,100 mark at 8,017.55 after moving between 8,159.75 and 8,008.10 intra-day. Today’s drop is also Nifty’s worst show since July 8 when it lost 163.95 points.
“Markets fell sharply on the back of profit booking and negative global cues. The selling pressure gained momentum after data released on Eurozone economic activity indicated continuing weakness in the region,” said Sanjeev Zarbade, Vice President- Private Client Group Research, Kotak Securities.
Stocks like Cipla, Tata Motors, Hindalco, Tata Steel and Tata Power were major laggards today. TCS, Sun Pharma, SBI, RIL, ONGC, Mahindra and Mahindra, L&T, Infosys, ICICI Bank and Coal India fell sharply. Bucking the trend, stocks of Hindustan Unilever, ITC, Maruti Suzuki and NTPC gained.
Sectorally, the BSE Realty sector index suffered the most by losing 4.91 per cent, followed by Oil & Gas down 2.58 per cent, Capital Goods 2.40 per cent and Metal 2.33 per cent, among others.
Globally, major markets in Asia ended down and European markets were weak in their opening trades.
A survey in China showed factory employment slumped to a 5-1/2-year low, which also unnerved investors.