Mumbai: The Sensex showed its unpredictable side again as it reversed two days of gains and dived about 232 points to close at 26,515 on Monday, pulled down by dismal factory output data and higher oil prices amid mixed Asian indicators.
The nervousness was palpable as investors looked forward to the release of CPI inflation, to be released on Tuesday. Wholesale inflation is due on Wednesday.
The broader NSE Nifty cut a sorry figure too, which cracked below the 8,200-mark.
Data on Friday showed that industrial output slipped into the negative zone again with a contraction of 1.9 percent in October, mainly due to a sharp decline in production of capital goods and poor performance of the manufacturing sector.
Sentiment further soured as IT stocks were hit by tough talk from US President-elect Donald Trump on visas while state-owned oil marketing companies declined after crude prices shot up to their highest since mid-2015.
The BSE Sensex stayed in the negative zone throughout the day and touched a low of 26,468.59 before ending lower by 231.94 points, or 0.87 percent, at 26,515.24. The index had gained 510.31 points in the previous two sessions.
The 50-share NSE Nifty slipped below the 8,200-mark to touch a low of 8,154.45, but settled at 8,170.80, down 90.95 points, or 1.10 percent.
Globally, oil soared today following a landmark deal by Russia and other non-OPEC producers to join the cartel in capping output in a bid to curb a stubborn global glut that has hammered prices down.
Benchmark Brent for February contracts went up USD 2.41 to USD 56.74 per barrel in Asian trade.
Infosys fell as much as 1 percent while Wipro shed 0.72 percent, but TCS inched up 0.58 percent. Shares of the fuel retailers such as HPCL, BPCL and IOC faced selling pressure and slumped by up to 4.25 percent.
Other big losers included Bajaj Auto 2.52 percent, Hero MotoCorp (2.29 percent), Tata Motors (2.05 percent), M&M (1.77 percent) and Maruti Suzuki (1.54 percent).
Among the BSE sectoral indices, auto fell the most by declining 1.73 percent followed by banking 1.67 percent, FMCG 1.20 percent and oil and gas 1.14 percent.
Mid-cap and small-cap indices fell 1.11 percent and 0.73 percent, respectively, as investors trimmed their exposure to book profits.
Meanwhile, foreign funds bought shares net worth Rs 200.52 crore last Friday, as per the provisional data.
In rest of Asia, Hong Kong's Hang Seng tumbled 1.44 percent as investors look ahead to an expected US interest rate hike later this week. China Shanghai Composite Index fell 2.47 percent while Japan's Nikkei surged 0.84 percent, helped by weakness in the yen against the American currency.
European markets, however, were in a better shape. London's FTSE rose 0.22 percent, Paris gained 0.17 percent while Frankfurt's DAX shed 0.17 percent.
Asian Paints emerged as the top loser among the Sensex constituents by diving 3.33 percent to Rs 910.25 followed by Axis Bank at 2.56 percent to Rs 444.60.
Of the 30-share Sensex pack, 23 scrips ended lower.