The BSE Sensex fell over 283 points on Wednesday to 18,145.25 in heavy selling towards the close on profit booking at 7-month high levels ahead of the settlement in this month's derivative contracts and weak openings in the European markets.
Realty, consumer durables, metals, banking, power, PSU and capital goods faced sell-offs.
The country's largest lender SBI was the top loser from the Sensex pack, falling 7.91 per cent on reports that the bank has committed to provide loan of around Rs 1,200 crore to the debt laden Kingfisher Airlines.
Fall in ICICI Bank, HDFC, RIL, Bharti Airtel, Tata Steel, Jindal Steel, Sterlite, L&T, DLF, BHEL and Hindalco washed out almost 200 points from the index.
The Bombay Stock Exchange 30-share Sensex initially touched a 7-month high of 18,523.78 and moved in a narrow range till afternoon.
But selling by investors at that level pulled it down to 18,145.25, erasing 283.36 points or 1.54 per cent. In last two sessions, it had risen 274.62 points or 1.51 pct.
The NSE 50-issue index Nifty also tumbled 101.80 points or 1.82 per cent to 5,505.35.
"Volatility associated with the penultimate day of derivative series expiry was very much visible today," said Shanu Goel, Research Analyst at Bonanza Portfolio.
"Negative openings in European markets again negated the sentiments. Market is likely to witness increased volatility and global developments related to Greece and US economy will continue to influence the market sentiment," she added.