The BSE benchmark Sensex plunged over 550 points to slip below the 36,000-mark on heavy selling in IT, auto and telecom stocks, after the rupee collapsed to a new life-time low amid surging crude oil prices.
After a weak start, The BSE 30-share barometer plummeted below the 36,000-mark to hit a low of 35,911.82, finally settling 550.51 points, or 1.51 per cent, down at 35,975.63.
The gauge had gained 299 points in the previous session Monday after the Reserve Bank of India (RBI) announced measures to shore up liquidity.
The NSE Nifty, too, stayed in the negative terrain through the session and hit a low of 10,843.75, finally ending 150.05 points, or 1.36 per cent, lower at 10,858.25.
Market cracked as rupee hit a new low due to increase in oil prices and concern over balance of payment, said Vinod Nair, Head of Research, Geojit Financial Services.
“Despite Government’s plan to cut borrowing in H2FY19, yields continued to increase due to rate hike expectation from RBI. Sentiment for equity has turned tepid given heightened volatility in the domestic and global financial markets,” he added.
According to market analysts, the outcome of RBI monetary policy, which is scheduled Friday, will provide further direction to the markets.
The three-day RBI policy review began Wednesday, and the Monetary Policy Committee (MPC) is expected to go for a 25 basis points hike. The rupee breached the 73-mark for the first time to hit an all-time low of 73.41 (intra-day) against the US dollar.
Meanwhile, Brent crude oil near $85 a barrel.
In the Sensex pack, M&M was the biggest loser, tumbling by 6.66 per cent, followed by TCS dropping 4.14 per cent.
Other laggards include Axis Bank, ICICI Bank, Maruti Suzuki, Kotak Bank, Infosys, Bharti Airtel, Hero MotoCorp, Reliance Industries, Asian Paint, PowerGrid, HUL, Wipro, Sun Pharma, SBI, NTPC, Tata Motors, ITC, Tata Steel, IndusInd Bank, HDFC Bank, Adani Ports, and L&T, falling up to 3.91 per cent.
On the other hand, Yes Bank continued its recovery for the second straight session and emerged top gainer in the Sensex kitty by surging 5.79 per cent, followed by Vedanta rising 3.09 per cent, Coal India 1.60 per cent, ONGC 1.45 per cent and Bajaj Auto 0.16 per cent.
Among sectoral indices, the BSE auto index emerged the worst performer by declining 2.90 per cent, followed by teck shedding 2.38 per cent, IT 2.23 per cent, bankex 1.54 per cent, FMCG 1.17 per cent, consumer durables 0.83 per cent, power 0.48 per cent and healthcare 0.38 per cent.
While, metal, oil and gas, PSU and capital goods indices managed to end in the positive zone, rising up to 1.74 per cent.
In the broader markets, the mid-cap index fell by 1.47 per cent, while small-cap index shed 0.40 per cent.Domestic markets were closed on Tuesday on account of Gandhi Jayanti.
Meanwhile, foreign funds sold shares worth a net of Rs 1,842 crore, while domestic institutional investors bought equities worth Rs 1,805 crore Monday, provisional data showed.