The stock benchmark fell sharply on Tuesday as slowing growth prospects continued to weigh on investor sentiments.
The main 30-share BSE index closed at 15175.08, down 204 points while on the NSE, Nifty fell 68 points to finish at 4544.20.
Among the 30 Sensex components, just four managed to close in the green. Among the major losers, L&T, Tata Power, Tata Steel, Hero MotoCorp and JP Associates lost over 5 per cent.
Elsewhere across the world, stock markets were mixed on Tuesday as a rebound in Asia a day after news of North Korean leader Kim Jong Il's death faded and European shares opened lower on debt crisis worries.
Benchmark oil rose above $94 while the dollar weakened against the euro and yen.
In early European trading, the FTSE 100 index of leading British companies was down 0.5 per cent at 5,335.07 and Germany's DAX dropped 0.4 per cent to 5,648.03. France's CAC 40 index shed 0.4 per cent to 2.961.07.
In Asia, South Korea's Kospi led regional gains, rising 0.9 per cent to close at 1,793.06 a day after tumbling 3.4 per cent on news of Kim's death.
Japan's Nikkei 225 index climbed 0.5 percent to end at 8,336.48 and Hong Kong's Hang Seng edged up less than 0.1 per cent to 18,080.20. In mainland China, the benchmark Shanghai Composite Index dipped 0.1 per cent to close at 2,215.93 after gaining as much as 1 per cent earlier, and the smaller Shenzhen Composite Index lost 0.4 per cent to 909.02.
Benchmarks in Australia, New Zealand and Singapore also declined.