The rising fiscal deficit burden is another blow for the stock markets, the government has already utilized 85% of the target fiscal deficit and the Indian government is at the verge of borrowing more from the Reserve Bank which could create mayhem on the markets.
The domestic currency lingered in a range between Rs 53.25 and Rs 53.40 per dollar during the session.
Market neglecting the government announcement on Friday to allow Foreign Institutional Investors (FII) to invest in stocks to attract more foreign funds.
RBI has taken many measures to hold the depreciation of rupee by easing interest rates for Non Residents and it also put curbs on speculation on forex trading.
On the first day of the calender year benchmark Sensex opened on a positive note, then slipped into the negative terrain, as most of the markets remained closed on account of New Year, which affected the rupee sentiment further.
At 1.30 pm IST, BSE was seen trading at 15,454.92 down by 89.01 points or 0.57%. The 50-share NSE was at 4614.10 down by 1.20 points or 0.22%.