Mumbai: Equities snapped a two-day rally as the market benchmark Sensex plunged by 330 points to 24,287.42 ahead of the release of GDP numbers for the third quarter as selling pressure intensified in the second half of the session on bearish European cues.
The BSE barometer, which opened on a flat note, remained sideways for most part of the session awaiting quarterly GDP numbers, but sank heavily on weak opening in European shares.
Most markets in Asia, including China and Hong Kong, were closed for the Lunar New Year holiday.
"Continuous fall in oil prices and slowdown in China is impacting global markets as well as India. European market has reacted negatively on disinflation concerns," said Vinod Nair, Head-Fundamental Research of Geojit BNP Paribas.
Moreover, the rupee depreciated by as much as 30 paise against the American currency.
The BSE Sensex resumed higher at 24,637.41 and firmed up further to a high of 24,698.95 on early buying in view of good foreign capital inflows. However, it dropped afterwards to 24,196.84 on fag-end selling pressure on the back of lower European cues, before finishing at 24,287.42, showing a loss of 329.55 points or 1.34 percent.
This was the index's biggest single-day fall since January 20. It had gained 393.65 points in the last two sessions.
The NSE 50-share Nifty also moved down by 101.65 points or 1.36 percent to close at 7,387.25 after moving in a range of 7,512.55 to 7,363.20.
Steel stocks extended gains registered in the previous session after the government set a floor price or minimum import price (MIP) for import of a total of 173 steel products in a bid to restrict cheap steel imports which has adversely affected the domestic steel industry.
Bhushan Steel surged by up 6.28 percent, JSW Steel ended 0.99 percent higher, while Tata Steel gained 0.19 percent.
Shares of Jet Airways rallied by 4 percent after the airline reported a record profit of Rs 467.11 crore for the quarter ended December 31, on the back of lower input costs.
Overseas, Japan's Nikkei ended 1.1 percent higher as most regional markets remained closed. However, European markets traded lower, extending last week's tumble. Key indexes in France, Germany and the UK slumped by up to 1.61 percent.
Back home, 22 scrips out of the 30-share Sensex pack ended lower.
Major losers were, Tata Motors (3.94 percent), ITC (2.72 percent), ONGC (2.43 percent), Sun Pharma (2.42 percent), TCS (2.36 percent), Wipro (2.25 percent), Infosys (2.20 percent), HDFC (1.85 percent) HDFC Bank (1.82 percent), HUL (1.78 percentt), M&M (1.63 percentt), Coal India (1.26 percentt), Dr Reddy's (1.24 percentt), NTPC (1.20 percentt), Asian Paints (1.11 percentt) and RIL (1.10 percentt).
However, Axis Bank gained 2.38 percent, followed by SBI 2.29 percent, Bharti Airtel 1.27 percent, Lupin 0.97 percent and GAIL 0.59 percent.
Among the S&P BSE sectorial and industrials indices, IT fell by 1.95 percent, teck (1.60 percent), oil&gas (1.48 percent), energy (1.35 percent), FMGC (1.25 percent), auto (1.03 percent), healthcare (0.99 percent), power (0.92 percent) and metal (0.85 percent).
However, telecom, realty and consumer durables were the only sectors up by 0.78 percent, 0.37 percent and 0.19 percent, respectively.
In broader markets, mid-cap and small-cap indices ended 0.23 percent and 0.02 percent lower, respectively.
The market breadth turned negative as 1,478 shares ended lower, 1,193 advanced, while 130 ruled steady of the total 2,801 Stocks traded.
The total turnover fell to Rs 2,471.53 crore from Rs 2,853.97 crore on Friday.