The S&P BSE Sensex and NSE Nifty 50 indexes extended losses in afternoon trading weighed down by weakness in banking, metal and financial services shares. The Sensex slumped as much as 424 points to hit an intraday low of 41,189 and the NSE Nifty 50 index touched an intraday low of 12,126. Earlier in the day, the benchmarks opened lower tracking losses in other Asian peers as fears about the economic impact of China's spreading virus outbreak curbed risk appetite. Analysts also expect Indian markets to remain volatile until the announcement of the budget on Saturday, which may include government measures to revive economic growth that has slipped to a more than six-year low.
As of 2:51 pm, the Sensex traded 412 points or 1 per cent lower at 41,200 and the NSE Nifty 50 index tumbled 120 points or 0.98 per cent to 12,128.
All the 11 sector gauges, barring the Nifty Pharma index, were trading lower led by the Nifty Metal index's nearly 3 per cent fall. Nifty PSU Bank, Nifty Bank, Nifty Financial Services and Nifty Private Bank indexes also fell between 1-2 per cent each.
Mid- and small-cap shares were largely outperforming their larger peers as the Nifty Midcap 100 index was down 0.1 per cent while the Nifty Smallcap 100 index was trading on a flat note.
In the Nifty 50 basket of shares, 36 were trading lower while 14 were among the gainers.
Vedanta Limited was top loser in the Nifty 50 basket, the stock dropped 4.2 per cent to Rs 149. Tata Steel, JSW Steel, IndusInd Bank, Hindalco, Tata Motors, HDFC Bank, State Bank of India, Power Grid, GAIL India, Bharti Airtel and HDFC were also among the losers.
On the flipside, Dr. Reddy's Labs rose 5 per cent to Rs 3,186 despite reporting loss of Rs 569.7 crore against profit of Rs 485.2 crore in the same quarter last year.
Mahindra & Mahindra, Cipla, Tech Mahindra, Bharat Petroleum, ICICI Bank, Eicher Motors and UltraTech Cement were also among the gainers.
The overall market breadth was negative as 1,408 shares were declining while 1,072 were advancing on the BSE.