Sensex closes below 15,500, lowest level in 2 years
Initially, Sensex gained nearly 150 points but fell sharply to end with a loss of 345.12 points, or 2.18 percent to 15,491.35, a closing levels last seen on November 3, 2009.
Similarly, the broad-based National Stock Exchange index Nifty lost 92.75 points to 4,651.60.
The last hour selling followed the Reserve Bank's raising flag on growth concerns, but left Cash Reserve Ratio (CRR) unchanged.
Marketmen said investors were expecting RBI to lower it from 6 percent to infuse liquidity in the market.
"Growth is clearly decelerating. This reflects the combined impact of several factors -- the uncertain global environment, the cumulative impact of past monetary policy tightening and domestic policy uncertainties," the RBI said in monetary policy review.
After raising lending rates 13 times since March 2010 to tame inflation, RBI finally put a pause on the hike which was a market positive, they added.
Reliance Industries, Sensex heavyweight, lost 3.43 percent and L&T, 5.33 percent. State Bank of India was down 3.67 percent and Sterlite Industries, 4.28 percent.
Others losers included BHEL, Coal India, DLF, HDFC Bank, Hero MotoCorp, ICICI Bank, TCS, Tata Steel and Tata Power.
All the 13 sectoral indices ended with losses of up to 4.36 percent, while 27 of the 30 Sensex stocks closed with losses.