Below the normal rainfall so far this year has halted a strong bull run on the bourses pulling down the key indices Sensex and Nifty by more than three per cent amid a sudden pullout by foreign institutional investors.
The Bombay Stock Exchange 30-share barometer ended the week at 15,160.24, at a net a fall of 510.07 points or 3.26 per cent from its last weekend's close.
The sensex crossed 16,000 level for the first time in 14 months to touch a trading high of 16,002.46 on August 4.
It rose by 2,166 points or 16 per cent in the last three weeks on impressive earnings season.
The broader 50-share Nifty of the National Stock Exchange also tumbled by 155.05 points or 3.34 per cent to close the week at 4,481.40 from its previous weekend's close.
The initial public offer by state-run NHPC, which got good response on the first of its opening, also raised fears that it will absorb liquidity from the secondary market.
Analysts said that monsoon rains is the main source for nearly 60 per cent farm irrigation in India and considered crucial for Asia's third-largest economy, which has started showing signs of recovery.
As per the provisional figures, Foreign Institutional Investors (FII's) sold shares worth Rs 2,113 crore in the concluding three days of week.
FMCG, Realty and Auto sectors witnessed heavy profit selling after the recent surge in these stocks.
During the week, the trading volume also showed marked fall. The volume on the BSE was relatively low at Rs 30,859 crore compared to Rs 33,007 crore in the last week. The turnover on the NSE also fell to Rs 94,108 crore from Rs 1,07.707 crore in the previous week.
India's largest public sector company, Reliance Industries however, gained 1.98 per cent after Petroleum Minister Murli Deora made a statement in the Parliament on August 6 that price approved by the Empowered Group of Ministers (EGoM) for RIL gas from the KG D6 field was lower than the price it had approved for some of the other operators in the country.
Among major losers, Hindustan Unilever lost 7.33 per cent, ITC 7.96 per cent, Maruti Suzuki 8.63 per cent, Hero Honda 7.74 per cent, HDFC Bank 7.14 per cent, Reliance Comm 7.58 per cent and DLF 6.99 per cent.
The BSE FMCG index dipped by 6.71 per cent, the BSE Realty Index by 5.93 per cent, the BSE Auto Index by 4.49 per cent and the Bankex by 4.20 per cent.