Indian benchmark indices Sensex and Nifty fell over 1 per cent on Monday and extended losses for a fifth straight session tracking weakness in Asian peers. Although selloff was visible across the sectors, banking and metal shares fell the most.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.35 percent, while Chinese stocks remained shaky following the Federal Reserve's hawkish policy stance and S&P's downgrade of China's sovereign rating last week.
The Nifty was down 0.91 percent or 91 points at 9,873.45 as of 12.21 pm, while the Sensex was 0.89 percent or 285 points lower at 31,6537.81.
"It's a clear case of correction out there with investors taking a more cautious approach in the near term," said Siddhartha Khemka, Head of research - Equity, Centrum Wealth.
Shares of HDFC Bank Ltd and Larsen & Tourbro Ltd fell 1.5 percent and 2.3 percent, respectively.
Meanwhile, Shopper's Stop Ltd climbed to its highest since Feb. 5, 2015 after an Amazon affiliate agreed to buy a stake in the retailer.