The benchmark BSE Sensex shed close to 450 points ahead of the release of second-quarter GDP data and the country reporting a fiscal deficit of 96.1 per cent of the budgeted target till October-end.
The Sensex closed at 33149.35, down 453.45 points while Nifty lost points to end at 10226.55 as selling pressure gripped frontline indices leading to the big correction.
Offloading of positions heavily by participants with today being the last day of November series contracts in the derivatives segment also dampened the domestic sentiment.
All BSE sectoral indices were trading in the negative zone. Among them, banking index fell 1.81 per cent, followed by metal 1.19 per cent, IT and PSU 1.07 per cent each.
Major Sensex losers were Wipro (-2.75%), Axis Bank (-2.58%), Kotak Bank (-2.56%), Reliance (-2.49%) and State Bank of India (-2.36%), while the only four gainers were Bharti Airtel (+0.28%), L&T (+0.26%), Dr Reddy's (+0.17%) and Bajaj Auto (+0.07%).
PSU banks appeared to be under pressure as the likelihood of interest rates falling further from current levels has been postponed.
Data released by the Controller General of Accounts showed that the country’s fiscal deficit had reached 96.1 per cent of the budgeted target in October-end. This was in stark contrast to the 79.3 per cent of the target in the same period of 2016-17.
Lower revenue realization and higher expenditure by the government were cited as among the major reasons behind this.
On the other hand, investors will be watching closely as the CSO releases the September quarter GDP data less than an hour from now.
Analysts expect growth to pick up this quarter after GDP growth hit a 13-quarter low of 5.7 per cent in the April-June quarter of 2017-18, the lowest under the Narendra Modi government.