The Sensex ended the day sharply lower as institutions sold heavily into frontline stocks that rallied substantially for most of the last week.
The Sensex ended the day lower by 431 points, while the Nifty lost a huge 128 points in trade. Leading the set of losers today were heavyweights Tata Motors and ONGC. Cipla and Axis Bank were the other major losers in trade from the Nifty.
Shares in Mahindra and Mahindra fell after it was downgraded by a brokerage firm. Metal stocks were also badly hit with Hindalco, Jindal Steel and Tata Steel slumping.
A few stocks that gained ground from the Sensex were FMCG stocks like HUL and ITC along with Wipro.
Among the small and mid cap stocks, HCC rallied after reports that Piramal was eyeing its two road projects. The hardest hit in trade were the PSU banking names including the likes of Union Bank, Oriental Bank of Commerce, Andhra Bank and Allahabad Bank.
IFCI on the other hand gained ground after reports of a divestment of stake in Tourism Finance Corporation.
Mid cap stocks like Havells India, Union Bank and IDBI Bank saw heavy selling pressure. The worst hit was Unitech which slumped a huge 10 per cent.
Meanwhile, markets in Europe were trading significantly lower, while most of Asia also ended the day with losses.