Stocks across world markets remained in the negative zone as Eurozone worries persisted.
The Sensex, after hovering in the negative zone for most of the day, slipped to a low of 16,709 in intraday trade.
The index finally ended down 188 points at 16,745. The Nifty shed 52 points at 5,032.
"We recently lowered our GDP forecasts for both 2011 and 2012 to 7.2% and 7.3%, respectively.
"This markdown is to take into account the fact that firstly, interest rates are likely to edge up to higher levels than what we'd expected a few months ago.
"Also a small but additional drag from what should be now slower export growth going ahead," Credit Suisse said in a research note.
Weak cuesAsian markets ended in the red today after a meeting of European policymakers' produced no new ideas for solving the continent's crippling sovereign debt crisis. Hang Seng slipped 2.7% to 18,917.
Shanghai Composite, Straits Times and Taiwan Weighted dropped 1-2% each. In Europe too, CAC and DAX dropped 2.7% each. FTSE shed 2% to 5,262.
Over the weekend, Financial Ministers from Europe met in Poland to discuss ways of handling the debt crisis, the meeting however, made little headway in resolving the banking crisis.
There are concerns that the European debt crisis may snowball into a full blown financial crisis, affecting Europe and other countries.
Meanwhile, the International Monetary Fund said that Greece must implement reforms agreed under an EU/IMF bailout plan and improve tax collection to qualify for further rescue payments.
Consumer Price IndexBack in India, CPI based on retail prices stood at 111.7 points in August, compared to 110.4 points in July, as per data released by the government today.
Expensive food and clothing pushed up the Consumer Price Index by 1.18% in August vis-a-vis the previous month, but experts said too much should not be read into the numbers, as the data on retail prices is yet to stabilise.
Among sectoral indices, the BSE capital goods index shed 2% to 11,786. Bankex, metal and oil & gas indices slipped over 1% each. BSE IT index dropped 1% to 5,929 as the rupee weakened again.
Larsen & Toubro was the biggest dragger among Sensex stocks and slipped 3% at Rs 1,560 despite the company securing new orders worth Rs 1,015 crore ($214.75 million) in the building and factories segment during the current quarter.
Stocks in newsAmong other losers, Sun Pharma's US arm has resolved issues raised by the country's health regulator regarding violation of manufacturing standards.
The stock dropped 2.6% to Rs 475. Sterlite, DLF, Cipla and ONGC dropped 2-3% each.
Shares of multinational companies such as Honeywell Automation, Kennametal India, Astrazeneca Pharma, BOC India, Hella India and Ineos ABS (India) rallied 1-6% each in an otherwise weak market on delisting hopes.
The government had made it mandatory for all listed companies to have minimum 25% public holding. According to shareholding pattern filed by these companies on June 30, foreign promoters of all these companies have more than 80% stake.
Gravita India, Aries Agro, Aanjaneya Lifecare also rallied on huge volumes.
The BSE market breadth was marginally negative. Out of 2,884 stocks traded, 1,415 stocks declined and 1,357 advanced.
Stocks across world markets remained in the negative zone as Eurozone worries persisted. 