The 30-share Sensex ended down 35 points at 26,349 and the 50-share Nifty ended down 20 points at 7,864.
In the broader market, both BSE Mid Cap and Small Cap indices closed below the benchmark indices with losses of around 0.2% each.
The market breadth ended weak with 1634 declines against 1291 advances on the BSE.
Foreign investors were net sellers in equities to the tune of Rs 671 crore on Monday.
Meanwhile, WPI inflation has come around 2.38% for the month of September compared to 3.74% in August, lowest in 33 months.
With better than expected figures on retail inflation too, analysts expect RBI to be able to meet its 2016 target of 6% of retail inflation by mid-2015 itself and adopt a dovish stance on policy rates soon.
On the back of low retail inflation the rupee had hit a high of 60.90 in early trades against US Dollar, its highest since September 23, 2014.
However, it later reversed direction and is currently trading at 61.38 against US Dollar.
Global Markets
NIkkei declined sharply by 2.4% on global growth concerns and a strong Yen while Chinese stocks recovered slightly with mainland investors heartened by easier money conditions and Hong Kong gained after a crackdown on protestors.
Paring early gains both Shanghai and Hang Seng indices closed with losses of 0.2% and 0.4% respectively.
Global markets continue to struggle on account of weak data from Japan and Europe plus lingering growth concerns about China. Continued fall in global crude prices has further dampened investor sentiments.
The crude prices will see further decline as OPEC countries have refused to cut-down output despite excessive supply in the international market and weak demand from Europe and China.
European markets extended losses with FTSE 100 and DAX losing around 0.5% while CAC 40 has lost around 0.7%.
Sectors and Stocks
BSE Bankex, and Power indices closed with gains of around 0.5%. while BSE Reality index plunged by 9.5% due to massive selling in DLF stock.
Positive inflation data uplifted certain rate sensitive stocks such as SBI and Axis Bank which closed with gains of 2-3% each while ICICI Bank closed flat.
Reliance Industries closed with a gain of 0.3% on beating analysts’ expectations during the July-September quarter, with its profit increasing 1.7 per cent over the year-ago period.
At Rs 5,972 crore, however, its net profit was 1.7 per cent higher than Rs 5,873 crore in the same period last year.
Among the defensive stocks, HUL closed with gain of around 2%.
Baja Auto closed with a gain of more than 2.5% after the stock was upgraded to ‘buy’ by Bank of America-Merrill Lynch citing higher volume and average selling prices, and increased contribution from dirt-bike
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