The Sensex closed the day lower by 298 points at 16030 points, while the Nifty closed lower by 84 points. World indices were deeply in the red with Hang Sang closing the day lower by 3%, while the Kospi too closed lower by 3%, while Taiwan weighted was down more than 2%.

In Europe the UK's FTSE, German DAX and French CAC all lost between 1 to 2% in opening trade, on fresh worries over political instability in Greece. The politicians in the country have been unable to cobble up a government, raising the prospects of fresh election in the country.

The chances of anti austerity parties coming to power due to fresh elections saw selling in stocks on concerns that the political parties would not be able to meet requirements of a bailout package.

Among the major losers today were Tata Motors which plunged following a poor set of global sale figures. BPCL, Cairn, Bank of Baroda and Kotak were among the few stocks that gained in trading today.

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