The BSE benchmark Sensex tumbled 371 points today to close below the 16,500-mark, near its 15-month low, on frantic selling in line with falling overseas markets as fears of global economic slowdown and rising domestic interest rates in view of high inflation gripped investors.

The Bombay Stock Exchange 30-share index, Sensex, which opened on a high note, fell sharply by 371.01 points to 16,469.78, around the level last seen on May 24, 2010.

Similarly, the broad-based National Stock Exchange index, Nifty, dipped below 5,000-level by losing 112.45 points to 4,944.15.

Reliance Industries and Infosys, which carry 21 per cent weight on the Sensex, fell sharply.

IT, banking, metals and consumer durables led the fall.

Brokers said the market investors ignored the slight fall in food inflation and moved in line with the weak global trend.

Food inflation fell to 9.03 per cent for the week ended August 6 from 9.90 per cent in the previous week but failed to ease concerns over a further hike in interest rates.

They said weakening trend in Asia and lower openings in Europe on economic growth and debt worries made investors move away from securities.

RIL dropped 1.97 per cent to Rs 739.95 and Infosys by 3.56 per cent to Rs 2,362.05, following a steep fall in technology stocks in the US and weakening rupee.

Banking stocks were under pressure on fears that a further hike in interest rates will impact their business.

ICICI Bank, the second-biggest private lender, plunged the most in six months by losing 5.03 per cent to Rs 864.75 and SBI by 4.47 per cent to Rs 2,077.55.

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