The popular Sensex at BSE fell 136.55 points or 0.67 per cent to close at 20,203.34. The index rose 28.51 points at the day’s high in early trade and fell 232.64 points at the day’s low after the IIP data was released in the mid-morning.
The 50-unit index, S&P CNX Nifty at NSE was down 44.95 points or 0.73 per cent to settle at 6,090.90 in the closing, below 6100 mark. The BSE Mid-Cap index fell 0.51 per cent and the BSE Small-Cap index was flat, while most sectoral indices on BSE declined this day.
The index of industrial production plummeted to single digits in August 2010 at 5.6 per cent from 15.2 per cent last month and 10.6 per cent a year back. This drastic fall was backed by contraction in capital goods and non-consumer durables, points out StanChart Head of Research Samiran Chakrabarty adding: “The breadth of industrial production has been pretty weak this time.”
Banking stocks came off lows as slowdown in industrial production growth in August 2010 could ease pressure on the central bank to again raise rates at a policy review early next month.
The market breadth was negative, in contrast with positive breadth earlier in the day. Intraday volatility was high as the market edged lower in early trade tracking weak Asian stocks and lower US Index futures, while stocks extended losses in morning trade.