Today's drop comes despite GAAR postponement and some positive announcements that came through the amendments to the Finance Bill initiated by Pranab Mukherjee.

Banking stocks continued to drift lower on NPA worries with State Bank of India, ICICI Bank and UCO Bank dropping sharply. Other shares that ended sharply lower today were Jaiprakash Associates, DLF and Kotak Mahindra.

Among the few shares that gained in trade today were ITC, Ranbaxy Laboratories, TCS and Bajaj Auto. Shares in Asia and Europe were also trading lower on fears over Greece's austerity measures. Shares of Reliance Industries dropped 1.6%, as the company lowered its gas production from D6.

Markets are expected to remain weak on global weakness and mounting worries over India's weakening fundamentals. A falling rupee is expected to compound woes further.

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