Easing food prices not withstanding, the benchmark Sensex of the Bombay Stock Exchange on Thursday fell by 1.3%, or 249 points, to close at 18,336 in line with the fall in global markets.
The broader Nifty of the National Stock Exchange fell by 79 points to close at 5,486.
While China and Japan fell by 1.3% and 1.5% respectively, premier indices in the UK and Germany fell by 0.9% and 1.3% respectively.
The metal index led the fall with a loss of 3%. Sterlite Industries and Hindalco fell by 4.8% and 4.6% respectively following the losses in global metals as other commodity prices declined.
“There is a concern that China could tighten its monetary policy further and this led to a fall in global indices and also commodity prices as there is no support on lower price,” said Alex Mathew, head of research, Geojit BNP Paribas Financial Services. “The industrial production increased month-on-month but fell year-on-year.”
Growth in the index of industrial production (IIP) slowed to 7.3% in March, from 15.5% in the same month last year while food inflation eased to 7.7% for the week ended April 30 from 8.53% in the previous week.