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Extending losses to the second day, the BSE Sensex plummeted 930.55 points or 1.15 per cent to settle at 80,220.72, the lowest closing level since August 14. During the day, it tanked 1,001.74 points or 1.23 per cent to 80,149.53.
The NSE Nifty tumbled 309 points or 1.25 per cent to 24,472.10 as 47 of its constituents closed lower and three advanced. The index hit a low of 24,445.80 during the day.
A weak earnings growth trend and sluggish global markets hit investor sentiment, analysts said, adding that rising US bond yields and policy actions by China are triggering FII outflows.
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In contrast, ICICI Bank, Nestle and Infosys were the gainers from the pack.
“Bearish sentiment continued to dominate the domestic market today amid heightened volatility, with small and midcap stocks taking the biggest hit.
“The recent sharp rise in US bond yields signals diminished expectations for aggressive rate cuts by the US Fed, also affecting fund flows to EMs. In the short term, this bearish outlook may persist due to sluggish earnings growth trends,” said Vinod Nair, Head of Research, Geojit Financial Services.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 2,261.83 crore on Monday, while Domestic Institutional Investors (DIIs) bought equities worth Rs 3,225.91 crore, according to exchange data.
The BSE smallcap gauge tanked 3.81 per cent and midcap index slumped 2.52 per cent.
All sectoral indices ended lower. BSE Industrials tumbled 3.51 per cent, realty (3.29 per cent), metal (2.99 per cent), commodities (2.80 per cent), power (2.64 per cent), utilities (2.64 per cent), telecommunication (2.63 per cent) and consumer discretionary (2.54 per cent).
A total of 3,428 stocks declined while 559 advanced and 71 remained unchanged on the BSE.
“Nifty opened gap up however as the day progressed selling pressure intensified. On the daily charts Nifty has slipped decisively below the 20-week average (24718) which is a sign of weakness,” Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas said.
Shares of Hyundai Motor India Ltd, the Indian arm of South Korean automaker Hyundai, on Tuesday made a muted market debut and ended over 7 per cent lower against the issue price of Rs 1,960.
In Asian markets, Seoul and Tokyo settled lower, while Shanghai and Hong Kong ended higher.
European markets were trading lower. The US markets ended on a mixed note on Monday.
Global oil benchmark Brent crude climbed 0.61 per cent to USD 74.74 a barrel.
The BSE benchmark declined 73.48 points or 0.09 per cent to settle at 81,151.27 on Monday. The Nifty dipped 72.95 points or 0.29 per cent to 24,781.10.