Mumbai: Equity benchmarks languished for the third straight session on Tuesday as financial sector woes, auto sales slump and weak macro data triggered an across-the-board sell-off.
The 30-share BSE Sensex, which opened on a firm footing, crashed over 737 points in late afternoon trade, before finally recouping some losses to finish at 38,305.41, down 361.92 points or 0.94%.
The broader Nifty too underwent bouts of volatility and closed lower by 114.55 points, or 1%, at 11,359.90. The Sensex has now lost 684.33 points, or 1.76%, in three sessions, while the Nifty has dropped 211.30 points, or 1.83%.
Analysts said caution prevails among investors amid a deepening crisis at Punjab and Maharashtra Co-operative Bank (PMC) and fraud allegations against companies like Indiabulls Housing Finance Ltd.
DHFL shares plummet 20% amid concerns over exposure to HDIL, PMC Bank.
Other major laggards were IndusInd Bank, SBI, Bharti Airtel, ONGC, Tata Steel and Reliance Industries -- falling as much as 6.30%.
Among the Sensex constituents, HDFC twins, Mahindra and Mahindra, Maruti Suzuki, Kotak Bank, HUL and Asian Paints ended in the green.
"Contraction in core sector and concern on government's plan to stick with original fiscal target of 3.3% in spite of huge cut in tax raised concern over spending.
"Investors are not expecting a meaningful recovery in festival season due to continued weakness in auto sales. Volatility in banks and fall in rupee also influenced profit booking tendency in the market," said Vinod Nair, Head of Research, Geojit Financial Services.