The Indian stock market opened on a weak note this morning and lost further ground as selling intensified at several counters from across various sectors, amid growing worries about the impact of the ongoing partial shutdown of the U.S. governement on the global economy. Concerns about slowing growth back home hurt as well.
However, with investors switching over to the buying mode past mid afternoon, the market staged a strong comeback and eventually ended the session just marginally down after a brief spell in positive territory.
The BSE benchmark Sensex, which plunged nearly 270 points to 19,647.88 at one stage, ended the day with a marginal loss of 20.85 points or 0.1% at 19,895.10, around 35 points off the day's high of 19,921.38.
The Nifty index of the National Stock Exchange closed down 1.15 points or 0.02% at 5906.15. The Nifty touched a low of 5828.85 and a high of 5912 during the day.
In a significant move, the World Bank has lowered its 2013 and 2014 economic growth forecasts for China and most of developing East Asia on Monday, citing slower growth in the world's most populous nation as well as weaker commodity prices that have hurt exports and investments in countries such as Indonesia.
The Washington-based development bank now expects developing East Asia to expand by 7.1% this year and by 7.2% in 2014, down from its April estimate of 7.8% and 7.6%, respectively.
Bank stocks, which declined sharply and traded deep down in the red for much of the trading session, found some support towards the end and closed off their lows.
PSU, capital goods, realty and oil stocks too came off their lows. Automobile stocks recovered as well. FMCG stocks turned in a mixed performance. Select power, healthcare, metal and information technology stocks closed with strong gains.
Coal India lost over 3% on reports the government is likely to dilute 5% stake in the company via follow-on public offer in December 2013.
Ranbaxy Laboratories, up 5.5%, was the top gainer in the Nifty index. The stock moved higher on the back of reports that the company is looking to buy a manufacturing facility in India to secure its future launches. BPCL gained a little over 4%. IDFC, Lupin, HCL Technologies and Ambuja Cements gained 1.5% - 2.5%.
Apollo Tyres gained ground amid growing uncertainty about the status of the company's US$2.5 billion deal to buy Cooper Tire & Rubber Company.
The market breadth was slightly positive. Out of 2522 stocks traded on BSE, 1280 stocks moved up. 1089 stocks declined and 153 stocks ended flat.