Share markets in India have extended early losses and are presently trading deep in the red.

Benchmark indices staged a gap-down opening today, following a rout in US markets overnight after a number of Fed officials suggested the US economy was worse than the market was pricing in.

Selling pressure is also seen as investors worried over resurging Covid-19 cases in European cities that led to more restrictions.

All sectoral indices are trading on a negative note with stocks in the IT sector and automobile sector witnessing most of the selling pressure.

The BSE Sensex is trading down by 687 points, down 1.9% at 37,000 levels.

The NSE Nifty is trading down by 202 points.

IndusInd Bank is the top loser in NSE. Meanwhile, the top gainers in NSE today include HUL and Bharti Infratel.

The BSE Mid Cap index is trading down by 1.9%.

The BSE Small Cap index is trading down by 2%.

US stock futures are trading lower today. Nasdaq Futures are trading down by 47 points (down 0.5%), while Dow Futures are trading down by 44 points (down 0.2%).

The rupee is trading at 73.88 against the US$.

Gold prices are trading down by 0.3% at Rs 49,348 per 10 grams.

In news from the energy sector, ONGC is among the top buzzing stocks today.

Shares of the company declined over 3% after a massive fire broke out at the state-owned exploration & production company's plant in Surat, Gujarat.

The company said that no one has been injured in the accident so far.

As per media reports, the reason for the massive fire is being attributed to three consecutive blasts that took place at two terminals of the Hazira-based ONGC plant in Surat at around 3:30 am. The sound could be heard at a distance of over 10 km.

ONGC share price is presently trading down by 1%.

Market participants are also tracking Syngene International share price.

Shares of the company hit a record high of Rs 596.85 today, surging as much as 7% on the BSE in an otherwise weak market.

Since September 8, Syngene International has seen its share price surging more than 30% after the company and HiMedia Laboratories, which have collaborated to manufacture ELISafe 19, an IgG based ELISA test kit for Covid-19, received the approval by the Indian Council of Medical Research (ICMR).

Moving on to news from the mutual funds space, as per a leading financial daily, mutual fund distributors are discouraging investors from putting fresh money in multi-cap funds until fund houses clarify how they would navigate the recent regulatory circular.

The distributors said that lump-sum investments and flows through systematic transfer plans (STPs) from debt funds to such schemes are being put on hold.

Reports state that this could adversely impact flows into the schemes, which saw net outflows of over Rs 11 billion in August, and indirectly benefit other equity or debt categories as fresh allocations move there.

However, investment through systematic investment plans (SIPs) of less than Rs 50,000 are being continued on hopes the issue will be resolved in a month or two.

Note that earlier this month, the markets regulator mandated multi cap funds to allocate at least 25% of their assets in midcaps, as well as small caps by February next year.

The regulator later clarified that funds cannot only rebalance the portfolio in their multi-cap schemes but also facilitate the switch to other schemes and merge such schemes with large-cap schemes or convert them to another scheme category, such as large and mid-cap.

Assuming every fund rebalances, the circular is expected to trigger a move of around Rs 280 billion from large caps to small caps.

You see, despite the rally in small caps since March, there is still a huge valuation gap between small caps and Sensex.