Oil stocks are dragging with major losers like GAIL, ONGC and Cairn India. Nymex crude dropped over 5 percent to USD 50 a barrel, while Brent crude tumbled towards USD 53 after data showed Russian oil output at post-Soviet era highs and Iraqi oil exports at near 35-year peaks.
Ashutosh Raina of HDFC Bank said, "The risk-off sentiment appears to have engulfed the global markets with oil prices hitting 5-year lows and political uncertainty in Greece forcing investors to move to safe havens.”
“The dollar strength continues with dollar index hitting 91.5 levels and gaining against most currencies. The USD-INR pair has been relatively rangebound in the 63-63.50/dollar range. The Rupee is likely to be in the 63-64/dollar range with suspected intervention expected to continue," he said.
Even the Asian markets have opened sharply lower on the back of weak overnight cues following relentless fall in oil prices. Nikkei has opened down to a near three-week low as trading sentiment was hit by a double whammy of declining oil prices and a stronger yen. All Asian indices are down more than a percent each.
The US stocks declined sharply, with the S&P 500 extending losses into a fourth session, as energy companies took it on the chin as oil fell to its lowest since April 2009. The CBOE volatility index rose 12 percent to 19.92.
Even the European shares have closed sharply lower as concerns over the health of the eurozone resurfaced like the political uncertainty in Greece that weighed on markets.
From precious metals space, gold prices rose to above USD 1200 an ounce following weak equities and eurozone concerns.