Mumbai: The sell-off on Dalal Street continued in Wednesday's session as traders worried over rising coronavirus cases and tough stance by the Supreme Court on AGR dues of telecom operators.
Banking stocks were the most hit as they have huge exposure to telecom firms. Worries of greater disruptions in businesses rose due to a rising number of new coronavirus cases within and outside India.
"In a market hit by the adverse impact of a pandemic, it is too early to say when the feeling that the asset prices are lower than their intrinsic value will start coming in," said Joseph Thomas, Head of Research at Emkay Wealth Management.
The BSE S&P Sensex closed 1,710 points or 5.59 per cent lower at 28,870 while the Nifty 50 fell by 498 points or 5.56 per cent to 8,469.
All sectoral indices at the National Stock Exchange were in the red with Nifty private bank down by 6.9 per cent, financial service by 6.6 per cent, realty by 6.2 per cent and auto by 4.4 per cent.
Shares of telecom companies suffered a sudden plunge in the afternoon after the Supreme Court refused further relief on adjusted gross revenue (AGR) dues.
Vodafone Idea dropped by 34.85 per cent to Rs 3.16 per share, Bharti Airtel by 6.14 per cent and Tata Teleservices by 4.17 per cent.
Banking stocks too came under selling pressure. IndusInd Bank plunged by 24.58 per cent to Rs 455.65 per share while Kotak Mahindra Bank closed 11.23 per cent lower and HDFC Bank slipped by 7.66 per cent.
The other prominent losers were Bharti Infratel, Bajaj Finance, Bajaj Finserv, Hero MotoCorp, UPL, Titan and Mahindra & Mahindra.
However, Zee Entertainment jumped by over 26 per cent and Yes Bank was up by 4.1 per cent to Rs 61.10 per share as it prepared to resume operations in the evening after the moratorium on private sector lender is lifted.
The other prominent winners were IT major Tata Consultancy Services, ITC, Tata Steel and State Bank of India.
Meanwhile, Asian markets were in the negative terrain despite stocks on Wall Street bouncing back overnight.
In Japan, the Nikkei lost by 1.68 per cent, Shanghai Composite by 1.83 per cent, Hong Kong's Hang Seng by 4.55 per cent and South Korea's Kospi by 4.86 per cent.
On tuesday, the Trump administration proposed an 850 billion dollar stimulus bill to blunt the economic hit from coronavirus while many other governments look to fiscal stimulus.