The 30-share Bombay Stock Exchange index extended its freefall from Thursday's trade, losing over 300 points in a day marred with volatile trading. With losses ranging between over 250 to 400 points - mainly on global markets witnessing huge sell-off on Thursday amid fresh concerns about recession - the 30-share BSE benchmark ended the day at 16,141.67, down 328.12 points or 1.99 per cent.
HOW THE MARKETS FARED
Investors were jittery throughout the day, with information technology (IT) and banking stocks facing the maximum hit. IT behemoth Infosys' share price tanked 5.79 per cent, to end the day at Rs 2,225.40, becoming the highest loser of the day.
The negative investor sentiment seemed to spread across, as National Stock Exchange 50-share Nifty also closed in red, losing 98.50 points, or 1.99 per cent, to 4,845.65.
External events like lingering European debt problems that emerged concerns over the European banks and overnight murky US economic data, which indicated that the world is going into another recession, mainly distressed the market sentiment globally.
However, at home, higher inflation and rising interest rates, which might restrict the corporate profit growth, also continued weigh on the market.
FULL COVERAGE:How US, Europe economic worries played out
Barring realty, all other 12 sectoral indices ended down between 4.41 per cent and 0.39 per cent. IT index suffered a heavy blow after heavy downslide in their ADRs after Wall Street on Thursday recorded its biggest drop since US downgrade.
Capital goods, teck, banking and consumer durable stocks too attracted heavy profit-booking.
During the day, the 30-share BSE benchmark Sensex also lost 401.50 points or 2.44 per cent, to trade at 16,068.29 at 1.37 pm. The National Stock Exchange 50-share Nifty was also trading in red at the same time - at 4,828.95, down 115.20 points or 2.33 per cent.
The fall was led by information technology and banking stocks, where firms feared losing business because of a slowdown in the US and Europe economies.
The 30-share index opened on a weak note and was down over 300 points in early trade amid deepening worries of a global economic slowdown. The Bombay Stock Exchange Sensex fell by 351.37 points in opening trade to 16,118.42, while the National Stock Exchange's 50-share Nifty index slipped below the 4,900-point mark with a fall of over 100 points.
Asian stock markets also fell sharply lower amid signs of a possible US recession and renewed worries over the health of Europe's banks.
PERSPECTIVE: How US Fed reassured global markets the last time around
Brokers said the sentiment on the domestic bourses remained distinctly bearish after Asian stock markets plummeted by nearly 4 per cent following overnight losses in the US market on weak economic data for the American economy and renewed concerns about the eurozone debt crisis.
The Dow Jones industrial average on Thursday fell 3.7 per cent to 10,990.58, as banking major Morgan Stanley claimed the US and European economy was heading towards recession. The Standard & Poor's 500 index fell 4.5 per cent to 1,140.65. The Nasdaq composite fell 5.2 per cent to 2,380.43.
PERSPECTIVE: Why US and Indian markets are connected to each other
The sharp overnight plunge of 4-6 per cent in the benchmark indices in the US led to the heavy fall in other Asian markets too. Stocks in China were down over 1 per cent, while markets in Japan, Hong Kong, Australia and Taiwan were down by over 2 per cent.
European markets also fell sharply on Thursday amid deepening fears of major global economies, including the US, dipping into a recession again.
Indian stocks had plunged sharply on Thursday as well amid global market turmoil, with the Sensex tanking by 371 points to 16,469.79, its lowest level in nearly 15 months.
With PTI inputs