Sensex dips 244 points on rate concerns, weak global cues

The BSE benchmark Sensex today dipped 244 points as funds sold on weak global trend and renewed concerns that high inflation might lead to further hike in interest rates.

The Sensex, which had gained 252 points yesterday, rolled back by 244.31 points to 16,453.76. With this fall, the benchmark has logged a decline of 9.6 per cent in the July-September quarter, biggest dip in three years.

Brokers said interest rate concerns gathered momentum as food inflation rose to 9.13 per cent for week ended September 17, from 8.84 per cent in previous week - a development which Finance Minister Pranab Mukherjee had termed as "grave".

Trading sentiment also dampened on a weakening trend in the Asian region and lower openings in Europe over euro zone debt crisis and slowing US growth.

The broad-based National Stock Exchange index Nifty lost 72.20 points to 4,943.25 as stocks of metal, realty and banking sector suffered heavy losses.

The second heaviest on the Sensex, Infosys, fell 0.64 per cent ahead of quarterly earnings announcement amid a turmoil in global financial markets. Tata Consultancy lost 2.15 per cent and Wipro by 2.30 per cent. Software services exporters get more than 80 per cent revenue from the US and European markets.

Coal India slumped 5.15 per cent to Rs 332.75 after the cabinet approved a bill makes companies mining coal and other minerals pay for development of areas where they operate.

Shares of Anil Ambani-led Reliance Group companies fell even as the group asserted that it was not a beneficiary of any telecom licence issued in January, 2008.

The metal sector index suffered the most - down 2.68 per cent to 10,995.57, followed by realty - 2.08 per cent to 1,762.96. Banking index lost 1.84 per cent at 10,850.73 and auto index, 1.76 per cent to 8,498.42.