The markets continued to display high volatility for yet another day. After a soft opening, the Sensex rebounded into positive territory for a brief while only to slip back to lower levels.
The Sensex, which touched a high of 18,458 in late morning trades, however, was at 18,199, down over 238 points from the day's high.
Late session trades saw the Nifty shed 77 points at 5,441
Civil unrest in Libya following an uprising against the country's leader of 41 years, Muammar Gaddafi intensified, with several casualties being reported in the strife-stricken nation.
Following news of mounting worldwide dissent, Asian markets opened on a weak note, and effects were also felt on the Indian bourses.
Oil prices surged to clinch a 2.5 year high at $108.7 for Brent crude amidst concerns tensions in the Middle-Eastern country could hamper the OPEC-member's oil output, which could possibly spill over to other Middle-Eastern and North African countries.
At the same time, a powerful earthquake on New Zealand, which left nearly 65 dead, and sevral others injured and homeless, also sobered market sentiment across Asia-Pacific.
Japan's Nikkei, the Hang Seng, the Seoul Composite, the Straits Times, the Jakarta Composite and the Taiwan Weighted were considerably weak, and quoting 2% lower than their respective previous closes.
Major European indices also saw movements in the negative territory, with the FTSE 100, DAX and CAC 40 down nearly 1% each.
Domestically, political issues continued to simmer. The PM requested the Lok Sabha Speaker to proceed with the JPC formation to investigate into the burgeoning 2G spectrum scam, and announced the government is committed to weed out corruption.
In the ongoing pre-Budget parliamentary session, the FM said inflationary pressures were primarily due to food and fuel prices, and the economy may need to absorb the impact of rising global prices on inflation.
He also added supply-side monetary measures are being taken to tackle sticky inflation numbers.
Anticipation of a hike in excise duty saw the BSE Auto index languish for the second consecutiove day. The index was the top sectoral loser at 8,427 down 2.2%. The Capital Goods and Bankex indices were also laggards in trade, down 2% each.
Gainers on the Sensex were Reliance Industries at Rs 987 up 3%, Sterlite Industriues at Ts 168 and Reliance Communications at Rs 94 both up 1%.
Losers on the Sensex were Hero Honda at Rs 1,383 down 4%, Jaiprakash Associates at Rs 85 and HDFC Bank at Rs 2,131 both down 3%.
The broader markets relatively outperformed the benchmark; the Mid-cap index at 6,600 and the Small-cap at 8,065 were both down nearly 1%.
Sensex heavyweight L&T, which enjoys a heavy weightage in the BSE benchmark, saw heavy selling amidst profit-booking; the stock was down 2.5% at Rs 1,612.
Major losers in the Auto space were Hero Honda down 4% at Rs 1,383, Cummins India at Rs 645 and Amtek Auto at Rs 114 both down 3%.
The Oil & Gas index was the top sectoral performer at 9,664 up nearly 2% driven by the index's major Reliance Industries, which surged 3% at Rs 987 after the oil exploration major entered into a 50-50 joint venture with global energy major British Petroleum. The deal envisions a partnership in both the companies' sourcing and marketing funcions.
With 1,807 declines and 935 advances, the market breadth was very negative.
