The BSE Sensex fell below the 16k mark today, down 287 points at 15,864.86, on persistent selling in line with weak global markets amid investor worries over the euro-zone debt crisis and a slump in domestic banking stocks led by SBI after a cut in its ratings.
Besides banks, auto, PSUs, refinery, metals and FMCG were top sectoral losers from the Sensex pack. Banking major State Bank of India slumped to 52-week low after Moody's Investors Service cut its bank financial strength rating (BFSR), or stand-alone rating, to D+ from C-. Already, banking stocks have been under pressure on worries that rising interest rates would hurt borrowers' ability to repay loans and increase defaults. ICICI Bank and Axis Bank hit 52-week lows as well. Auto stocks fell on worries that high interest rates and rising petrol prices may hit car and two-wheeler sales this festive season.
The BSE's 30-share Sensex opened lower at 16,081.77 and dropped to 20-month low of 15,745.43. It regained a bit to close at 15,864.86, still down 286.59 points or 1.77 per cent. FIIs sold shares worth Rs 825.89 crore yesterday, higher than outflow of Rs 459.47 crore last Friday as per provisional data from the stock exchanges.
"There is no respite for equities given the heightened fears over the worsening euro-zone debt crisis. Greece continues to struggle to secure approval for fresh financial aid. The sentiment will remain fragile unless and until Greece gets fresh rescue funds." said Amar Ambani, Head of Research at IIFL.
The NSE 50-share Nifty also fell 77.35 points or 1.60 per cent to close at 4,772.15. Globally, European stocks tumbled in the early trade. Key indices in UK, France and Germany were down 3.41 per cent to 2.41 per cent. In Asia, indices in Hong Kong, Japan, South Korea and Singapore were down between 3.59 per cent and 1.05 per cent. Taiwan's index was up 0.48 per cent. The Chinese markets are closed this week for National Day holidays.
Among the sectoral indices, the Bankex dropped by 3.09 per cent, followed by Auto (1.94 pc), PSU (1.77 pc), Oil&Gas (1.74 pc), Metal (1.48 pc) and FMCG (1.34 pc).
Small-cap and Mid-cap indices also fell by 1.09 per cent to 1.28 per cent respectively.
Of the Sensex pack, SBI tumbled nearly 6 per cent intra-day. It settled 4.08 per cent down at Rs 1,786.70, its lowest close since September 4, 2009.
Other major losers were Coal India (4.98