The two key equity benchmarks, Sensex and Nifty, on Monday closed trading after a dismal show, ahead of the CPI inflation data scheduled to come out on Tuesday. The BSE Sensex tanked 617 points to 73,503. On the other hand, the NSE Nifty50 closed at 22,333, down 161 points.
On the 30-share Sensex platform, PowerGrid, Tata Steel, SBI, IndusInd Bank, HUL, HDFC Bank emerged in the red. On the flip side, Nestle, Bajaj twins, TCS, Asian Paints, UltraCemco were among the gainers.
In the broader markets, the BSE Smallcap index plunged 2 per cent, while the BSE Midcap index dropped 0.24 per cent lower following reports saying that the SEBI may revise rules for mutual funds investing in small-cap stocks amid concerns of overheating in this segment.
Sectorally, all the indices closed in the red, with auto, capital goods, FMCG, oil & gas, bank, Information Technology, realty, metal, and power declined 0.5-1 per cent each.
In the previous session on Friday, the BSE and the National Stock Exchange (NSE) remain closed on account of Mahashivratri.
"Continued sell-off in global markets due to uncertainty over rate cuts impacted the domestic market sentiment, which is currently at an overbought level. The stronger than expected US non-farm payroll data and caution ahead of the release of US inflation data tomorrow kept investors on the edge, said Vinod Nair, Head of Research, Geojit Financial Services.
In the realm of Asian markets, Japan's Nikkei 225 index experienced a downturn of 2.2 percent, while South Korea's Kospi witnessed a 0.8 percent decline. Conversely, Hong Kong's Hang Seng saw an uptick of 1.4 percent, and the Shanghai Composite surged by 0.7 percent. However, US markets concluded on a negative note last Friday.
Brent crude, the global oil benchmark, saw a modest increase of 0.29 percent, reaching $82.32 per barrel.
According to exchange data, Foreign Institutional Investors (FIIs) made equity purchases amounting to Rs 7,304.11 crore on Thursday.
Meanwhile, the Indian rupee depreciated by 8 paise to settle at 82.75 (provisional) against the US dollar on Monday, reflecting the bearish sentiment in equity markets. Analysts in the forex market noted that the weakening US dollar and a dip in crude oil prices provided some support against the downward pressure.
In trading at the interbank foreign exchange market, the rupee commenced at 82.74 and hit an intraday low of 82.76 against the greenback before finally settling at 82.75 (provisional), marking an 8-paise loss from its previous close.
On Thursday, the rupee had gained 16 paise to settle at 82.67 against the US dollar. Forex market remained closed on Friday due to Mahashivratri.