The benchmark 30-share BSE Sensex closed at 15,470.34, down by 366.13 points or 2.31% and the 50-share NSE Nifty closed at 4,651.60, down by 94.75 points or 2%.
Morning trading hours were good for the markets after RBI intervened in the currency market and imposed restriction on forward trading to control the fall of rupee further.
The rupee jumped more than 2% today, right after the RBI's move, which is the biggest single-day rise since two years
The central bank on Friday kept interest rate untouched in its mid-term monetary policy review due to fall in growth rate. The RBI's decision failed to sustain investors' enthusiasm.
Among Sectoral indices all the sectors were trading in negative terrain.
On the National Stock Exchange (NSE), the top volume gainers were DRREDY, GRASIM, HCLTECH, and GAIL posted gains between 0.83% - 4.6%.
The major losers on the NSE were LT (6.20%), PNB (5.59%), AXISBANK (5.71%) and JPASSOCIATE (4.80%).