Selling pressure prompted the markets to go further downwards; the Sensex touched 19,558 down 138 points, while the Nifty was at 5,862 down 42 points.
With food inflation at 8.69% YoY, and the fuel price index at 10%, the markets seemed to have reacted quite negatively to the news. The RBI said inflation is still at an uncomfortable level, and it would be revising its GDP projection in its January policy.
Stocks leading the Sensex were Infosys Technologies, JP Associates and Wipro, all up 1%. Top losers on the Sensex were Cipla down 5%, followed by Relaince Communications and Hindalco, both down 2%.
IT and Teck scrips were leading the sectoral indices. The IT index was up 1%, while the Teck index traded marginally in the positive. "The outlook for CNX IT still remains positive and will remain so untill the level of 6600 is not broken," said Deepak Singh Tanwar, Sound Equity and Consulting.
The Consumer Durables (CD) index was down nearly 4%, the poorest performer in the sectoral chart, while the Realty and Metal indices were down 2%. Tanwar added, "Though the outlook (for the CD index) is clearly negative, a corrective bounce is not ruled out."
The broader markets were trading heavily in the negative, with the BSE Smallcap down 3%, and the Midcap trading down 2%.
In the Asian markets, the Shanghai Composite was down 1%. Amongst the positive movers, the Seoul Composite was up nearly 2%, while the Nikkei and Taiwan Weighted were both trading up 0.5%.