Reliance Industries and bank shares tumble and topple Sensex as bears look to clear the froth in the price

The Sensex crashed 667 points while the Nifty closed below the 10,900-mark on Monday as investors remained in selling mode for the fourth straight session amid frothy valuations and mounting COVID-19 cases. A depreciating rupee and grim macroeconomic data further sapped risk appetite, traders said.

The 30-share BSE Sensex, which opened in the red, stayed in the negative zone throughout the session to close at 36,939.60, down 667.29 points or 1.77 per cent.

Similarly, the NSE Nifty tumbled 181.85 points or 1.64 per cent to end at 10,891.60.

The Sensex has now lost 1,553.35 points in four days, while the Nifty has shed 408.95 points.

Kotak Bank was the top loser in the Sensex pack in Monday's session, slumping 4.41 per cent, followed by IndusInd Bank, Axis Bank, ONGC, HDFC Bank, Bajaj Auto and Reliance Industries (RIL).

Only six index constituents closed with gains -- Titan, Tata Steel, SBI, L&T, HCL Tech and PowerGrid, spurting up to 3.15 per cent.

According to traders, massive selling in index majors RIL and HDFC duo dragged the key indices lower.

Further, foreign fund outflows and concerns over the unabated rise in COVID-19 cases across the world kept investors on edge, they added.

The rupee too sank 20 paise and settled below the 75 per US dollar mark.

On the macro front, India's manufacturing sector activity contracted at a slightly faster pace in July as demand conditions remained subdued, PMI data showed.

The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) stood at 46 in July, down from 47.2 in June.

This is the fourth straight month of contraction for the Indian manufacturing sector.

"As virus cases continued to rise and with the uncertainty regarding rate actions by the RBI, markets succumbed to the momentum slowdown visible in the last couple of trading sessions. Losses were led by financials.

"Although momentum has slowed down, stock specific action is still happening, dependent mainly on the earnings results and commentary. As long as the markets hold the current range, these downturns could be short-lived and should be utilised to accumulate quality stocks," said Vinod Nair, Head of Research at Geojit Financial Services.

BSE bankex, finance, energy, oil and gas, realty, utilities and telecom indices fell up to 2.73 per cent, while, consumer durables, healthcare, metal and industrials ended in the green.

Broader BSE mid-cap index slipped 0.31 per cent, while the small-cap gauge rose 1.02 per cent.

Global markets were mostly higher following upbeat PMI data from China and the Eurozone, though the rising coronavirus caseload capped the gains.

Bourses in Shanghai, Tokyo, Seoul settled on a positive note, while Hong Kong ended in the red.

Stock exchanges in Europe were also trading on a positive note in early deals.

Global oil benchmark Brent crude was trading 0.69 per cent lower at USD 43.22 per barrel.

India's COVID-19 tally crossed the 18-lakh mark on Monday, just a day after it went past 17 lakh, with 52,972 cases reported in a day, according to the Union Health Ministry data.

The number of recoveries surged to over 11.86 lakh, while the death toll climbed to 38,135.