Market benchmark Sensex tumbled 465 points on Tuesday, tracking losses in index heavyweights Reliance Industries, HDFC twins and Infosys despite a positive trend in global equities.
The 30-share BSE index ended 465.01 points or 0.95 percent lower at 48,253.51, and the broader NSE Nifty slumped 137.65 points or 0.94 percent to 14,496.50.
Dr Reddy's was the top loser in the Sensex pack, shedding around 2 per cent, followed by Reliance Industries, Sun Pharma, HDFC twins, Infosys, M&M and PowerGrid.
On the other hand, ONGC, Bajaj Finance, TCS, Nestle India and SBI were among the gainers.
"Domestic equities gave up gains towards the second half of the day and fell sharply as mounting uncertainty led by rise in the second wave of COVID-19 cases weighed on investors' sentiments," said Binod Modi, Head Strategy at Reliance Securities.
Barring PSU banks, selling pressure was visible across the sectors with pharma witnessing steep correction.
While a persistent increase in daily caseload in several states is still a matter of concern, a visible modest decline in new cases in many parts like Maharashtra and Delhi offers comfort, he noted.
Active COVID-19 cases in India rose to 34,47,133 against 34,13,642 on Monday, according to a Health Ministry update Tuesday morning.
Elsewhere in Asia, bourses in Hong Kong and Seoul ended on a positive note. Stock exchanges in Shanghai and Tokyo were closed for holidays.
Equities in Europe were largely trading with gains in mid-session deals.
Meanwhile, international oil benchmark Brent crude was trading 1.79 percent higher at USD 68.77 per barrel.