Mumbai: Indian shares fell more than 2% on Friday, led by energy group Reliance Industries and banks after data showed the US recession could worsen, affecting economies elsewhere.
By 12:10pm, the main BSE stock index was down 2.22% at 8,842.07 points, with all of its components falling.
The 50-share NSE Nifty index was down 2.17% at 2,728.95 points.
Reliance Industries, which controls the world’s largest refinery complex in western India, was hit by worries a deepening world economic crisis could squeeze global demand for its petroleum products, traders said.
The stock, which has the heaviest weighting in index, shed 3.1% to Rs1,253.55.
Data on Thursday showed a record number of US unemployment claims and a surprisingly sharp drop in manufacturing in the mid-Atlantic states, reinforcing concerns about a deepening US recession, which sent US markets to its lowest level in more than six years.
India needs to take more fiscal and monetary steps to stimulate demand and credit flows in a slowing economy, the deputy chairman of the planning commission said on Friday. Montek Singh Ahluwalia said the country was witnessing a decline in exports and investment demand.
Banks extended losses on weak global sentiment toward the sector and concerns about narrowing margins in a slowing economy.
Top lender State Bank of India fell 1% to Rs1,049.50 and rival ICICI Bank dropped 3.6% to Rs348.50.
Satyam Computer Services bucked the trend and rose 3.7% to Rs47.95, after the fraud-tainted outsourcer received approval to bring on board a strategic investor with the financial and management clout needed to ensure its survival.