The index touched the day's low of 18,235.45
Similarly, the broad-based National Stock Exchange index Nifty dipped below the 5,500 level before ending 92.15 points lower at 5,512.15 led by interest-linked stocks like realty, auto, consumer durable as well as the metals sector.
A weak Asian trend and lower opening in Europe further dampened the trading sentiment.
Stock markets have continued to decline since January 25, when the Reserve Bank of India increased interest rates for the seventh time since March and revised upwards its inflation forecast to 7 percent by the end of this fiscal.
Brokers said that rising input costs were eating into the margins of most consumer companies and raised concerns among investors on their earnings.
The realty sector index suffered the most by losing 4.96 percent to 2,279.62, followed by consumer durables index by 3.91 percent to 5,923.17. The auto sector index lost 3.56 percent to 8,841.90.
The most-heaviest on the Sensex, Reliance Industries fell by 3.02 percent to Rs 914.50 and second-heaviest Infosys Technologies by 0.68 percent to Rs 3,173.50. The two carry nearly 23 percent weightage on the index.
As the selling pressure spilled over a wide-front, smallcap index lost 3.59 percent to 8,546.29 and midcap index by 2.66 percent to 6,898.37.