The benchmark Sensex today erased initial gains to plunge over 348 points, posting its worst weekly loss in over two and a half years, on disappointment over the Union Budget and fresh debt concerns in Portugal.
Stock markets had opened on a strong note with the 30-scrip Sensex touching a high of 25,548.33 points in early trade on better-than-expected results from IT major Infosys.
However, lingering concerns over Eurozone debt resurfaced as reports said Portugal's biggest listed bank missed debt payments, triggering a sell-off, brokers said.
As a result, the BSE Sensex dipped below the 25,000 mark to touch day's low of 24,978.33 on across-the-board profit booking by participants. The barometer closed with a hefty fall of 348.40 points, or 1.37 per cent, at 25,024.35. The gauge has now shed 1,075.73 points in four straight sessions.
For the week, Sensex has fallen by about 3.61 per cent or 937.71 points - its sharpest weekly loss since December 2011.
Strong selling pressure was seen in sectors like realty, oil & gas, power, capital goods and PSU stocks that had outperformed in the run up to the Union Budget, brokers said.
"Markets are disappointed on the fiscal consolidation front. Budget didn't speak anything about rationalization of subsidies which was widely expected by most market players," said Rakesh Goyal, Sr. Vice President, Bonanza Portfolio.
The 50-share Nifty of the National Stock Exchange slipped below the crucial 7,500 mark by losing 108.15 points, or 1.43 per cent, to settle at 7,459.60.
During the session, Nifty shuttled between 7,625.85 and 7,447.20. For the week, Nifty lost about 3.8 per cent -- its biggest weekly loss in nearly 16 months.
Fears over the health of Portugal's largest listed bank, Banco Espirito Santo, rattled stock markets in Europe and across the Atlantic, said fund managers.
Investors have also been seen booking profits since the Indian market climbed to all-time highs. Caution prevailed ahead of IIP data for May this evening.
Major Sensex losers include Hindalco Industries, SBI, Axis Bank, ICICI Bank, RIL, ONGC, GAIL India, L&T and NTPC.
Sectorally, the BSE Realty sector index suffered the most losing 5.16 per cent, followed by Capital Goods 4.75 per cent, Power index 4.54 per cent and Metal index 3.69 per cent.
