The benchmark BSE Sensex cracked over 400 points on Monday tracking carnage in Asian equities after US President Donald Trump threatened to hike tariffs on Chinese goods this week. In a tweet on Sunday, Trump turned up the heat by saying he would raise import taxes on $200 billion in Chinese products to 25 per cent from 10 per cent on Friday.
Reacting to the news, Chinese bourses sank led by Shanghai Composite Index that plunged over 5 per cent. Other indices in Tokyo and Seoul were also trading in the red.
The 30-share Sensex too plummeted 453 points in early session. It, however, recovered some lost ground and was trading 321.03 points, or 0.82 per cent, lower at 38,642.23. The NSE Nifty was trading 93.95 points, or 0.80 per cent, down at 11,618.30.
Top losers in early session were Tata Motors, Tata Steel, Yes Bank, Vedanta, HDFC twins, IndusInd Bank, HUL, Axis Bank, Bharti Airtel, NTPC, ICICI Bank, ONGC, Bajaj Finance, Infosys and RIL, dropping up to 4.65 per cent.
Bucking negative market trend were PowerGrid, TCS, Asian Paints and Maruti, rising up to 0.42 per cent.
According to traders, domestic investors turned jittery amid bloodbath in Chinese equities.
In the previous session on Friday, the BSE bourse ended 18.17 points, or 0.05 per cent, lower at 38,963.26; and the broader NSE Nifty slipped 12.50 points, or 0.11 per cent, to close at 11,712.25.
Foreign institutional investors (FIIs) sold equity worth Rs 400.68 crore on Friday, while domestic institutional investors (DIIs) purchased shares to the tune of Rs 57.07 crore, provisional data available with stock exchanges showed.
On the currency front, the rupee depreciated 24 paise 69.46 against the US dollar in early trade.
Brent crude futures, the global oil benchmark, were trading 2.26 per cent lower at $69.25 per barrel.