Sensex falls 301 points

MUMBAI: Stocks took a severe beating on Monday amid weak global markets and concerns on surging inflation and record high oil prices.
Investors dumped smallcaps and midcaps, which had seen a recent run-up. All sectoral indices, barring IT stocks, were badly hit. Banking stocks led declines followed by capital goods and metals.
Bombay Stock Exchange's Sensex ended at 16348.50, down 301.14 points or 1.81 per cent. It touched a high of 16498.24 and low of 16300.88 during the day. National Stock Exchange's Nifty closed at 4875.05, down 71.50 points or 1.45 per cent. The index fell to a low of 4858 from a high of 4953.60.
There are reports that the government is unlikely to raise fuel prices this week since there is no political consensus on price increase, despite pressure from oil companies which are losing over Rs 580 crore a day due to surging crude prices.

"While a hike in fuel prices could take a toll on inflation, inaction could have an even greater cost, as it would contribute to the growing current account and fiscal deficits in countries such as India, putting further downward pressure on their currencies," said an analyst with a local brokerage.
India's wholesale price index rose 7.82 per cent in the 12 months to May 10, matching the previous week's rise of 7.83 per cent, data showed on Friday, slightly above the forecast of 7.77 per cent.
Crude oil rose above $133 on Monday as supply concerns heightened from key oil producer Nigeria and a partial shut-in at the North Sea oilfields. US crude rose $1.10 cents to $133.29. Last week, it struck a record high of $135.09. Second rung stocks underperformed the benchmarks. The BSE Midcap and Smallcap indices were down 2.54 per cent and 2.34 per cent respectively.

Infosys Technologies (up 3.29%), Bharti Airtel (3.15%), Tata Consultancy Services (2.69%) and Satyam Computer (0.25%) were the only gainers in the 30-share index.
Jaiprakash Associates (down 5.58%), Ambuja Cements (5.38%), BHEL (5.21%), Reliance Communications (5.08%), ICICI Bank (4.29%), HDFC (3.92%) and Maruti Suzuki (3.83%) were the worst hit in the Sensex pack. Market breadth was sharply negative with 2043 declines against 667 declines.
Meanwhile, stocks in Europe and Asia fell on concerns that more writedowns and rising raw-material costs will curb economic and profit growth.