Sensex falls nearly 2%, bonds retreat on Greece worries

Mumbai: India`s stock markets fell nearly 2 percent on Monday and bond yields rose as Greece looked set to default on its debt repayment this week, sparking concerns about foreign selling in emerging markets.

Greece closed its banks and imposed capital controls on Sunday to check the growing strains on its crippled financial system, bringing the prospect of being forced out of the euro into plain sight.

The Nifty fell 1.9 percent at 9:15 a.m., while the BSE Sensex was also down 1.9 percent.

The benchmark 10-year bond yield was up 3 basis points at 7.85 percent, while the rupee was trading at 63.90 compared to its 63.64/65 close on Friday.