The Indian market tumbled on Monday, weighed down by weak global cues and concerns over foreign funds repatriating investments, after Lehman Brothers filed for bankruptcy protection, Bank of America agreed to buy Merril Lynch and troubled insurer American International Group asked the Federal Reserve for a lifeline. Additionally, serial blasts in the capital on Saturday and a weak rupee in the forex market also weighed on investor sentiment.
Unwinding of long positions by traders and relentless selling by investors pushed the indexes sharply lower in early trading, while short covering in battered index heavyweights, helped by a sharp retreat in the price of oil to near $97- a -barrel in Asian trading and some recovery in banking stocks towards close of the session after China's central bank cut its benchmark lending rates limited losses.
In a bid to spur growth, China's central bank has cut its one-year lending rate by 27 basis points. The move will ensure a "stable and relatively fast growth" in the economy, the central bank said in a statement. The People's Bank of China also cut the share of deposits that banks must hold in reserve by 100 basis points starting from September 25.
After plunging by 850 points to 13,151 in early trading, a level last seen on July 17, the BSE Sensex has recouped some of its losses to finish at 13,531, down 470 points or 3.35% over Friday's close. The mid-cap index plunged 4.49%, the small-cap index plummeted 4.93% and the broader BSE 500 index slipped 3.78%. Meanwhile, the S&P CNX Nifty ended at 4,073, down 156 points or 3.68%.
On the BSE, market breadth reflected the gloomy mood, with only 359 stocks gaining compared to 2263 stocks that declined. Stocks across sectors ended in the red. Realty, IT, telecom, metal and power stocks were the major decliners.
Reliance Infrastructure (down 9.72%), Satyam Computers (down 9.45%), Ranbaxy Laboratories (down 7.60%), DLF India (down 7.54%), Jaiprakash Associates (down 6.51%), ONGC Corporation (down 6.01%), TCS (down 5.74%), Reliance Communication (down 5.68%), Tata Motors (down 5.16%), Hindalco (down 5.12%), Sterlite Industries (down 4.48%), Tata Steel (down 4.48%), Infosys (down 4.24%), Wipro (down 4.16%), BHEL (down 4.04%), ICICI Bank (down 3.82%), Larsen & Toubro (down 3.65%), HDFC Bank (down 3.34%), Grasim Industries(down 2.92%) and Mahindra & Mahindra(down 2.60%) were the major decliners.
However, Maruti Suzuki gained 2.80%, HDFC added 1.16% and ACC ended up 0.61%.
Stocks in news
IT stocks, which earn significant revenues from the US banking, financial and Insurance sectors, fell sharply over concerns that the present situation will result in sticky revenues or a delay in their receivables. United States accounts for more than half of the revenue of India's top outsourcing firms. Additionally, a sharp rise in the value of dollar against euro and pound recently is expected to hurt revenues of the IT sector.
Realty shares faced the brunt of the bear onslaught. Realty companies in which Lehman Brothers held maximum exposure such as DLF India, Unitech, Orbit Corporation and construction firm IVRCL Infrastructure were hammered.
Banking stocks slumped following negative sentiment among their US peers. However, bank stocks recouped most of their losses towards close of the session after the People's Bank of China cut its one-year lending rate by 27 basis points and reduced the reserve requirement by 100 basis points starting from September 25. Reliance Industries and several stocks from oil/gas space, namely Essar oil, Reliance Natural Resources, Cairn India, ONGC, Reliance petroleum and Gas Authority of India declined sharply on reports that the government is seeking legal opinion regarding a 'special oil tax' on the domestic crude oil production under the new exploration licensing policy (Nelp).
Crompton Greaves drifted down 1.90% after the company said it has acquired a US-based electric power systems contractor, MSE Power Systems, and two of its group firms for an enterprise value of $16 million. Titagarh Wagons plunged 6.64% after the company said it would acquire the entire ownership and management control of a non-banking financial company. Emami declined 2.90% after the company said it has more than doubled its open offer price for 20% stake in Zandu Pharmaceutical Works to Rs.15, 000 a share, from Rs.7, 315 earlier. Sun Pharmaceuticals slipped 1.05% despite the company receiving an approval from the US Food and Drug Administration for its generic Fosamax, alendronate sodium tablets.
Asian Markets
Major markets across the Asia-Pacific were closed for a public holiday, while key benchmark indexes in Taiwan and Singapore declined by 4.09% and 3.27% respectively.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.