Sensex tanks 300 points ahead of IIP data

Mumbai: The benchmark Sensex of Bombay Stock Exchange fell by over 300 points in early trade on Monday on continued selling by funds and retail investors on fears of weak industrial production data for July to be released later in the day.

Weak trend in the overseas markets on deepening debt crisis in the eurozone, was another dampening factor.

The 30-share index, which had lost 298.57 points in the previous session, fell further by 287.27 points, or 1.70 per cent, to 16,579.70 in the first few minutes of trade

IT, banking, metal and auto stocks led the fall.

At 1100 hrs (IST), the index was trading lower by 302.62 points at 16,564.35 points, with all sectoral indices, barring FMCG, in the negative zone.

The wide-based National Stock Exchange Nifty index also plunged by 88.65 points, or 1.75 per cent, to trade below 5,000 points level, at 4,970.80.

Brokers attributed the widespread losses in stocks to major sell-off by funds ahead of the release of index of industrial production (IIP) data for the month of July later Monday, which is expected to be disappointing.

In addition, fears of another hike in the interest rate by the Reserve Bank of India and a weakening trend on the Asian bourses in line with weekend losses on the US and European markets on deepening debt crisis in the eurozone, also dampened the trading sentiments here, they said.

In the Asian region, Japan`s Nikkei index was trading 2 per cent lower, while Hong Kong`s Hang Seng Index tumbled 3.27 per cent in early trade on Monday. The US Dow Jones Industrial Average closed 2.69 per cent lower on Friday last.