According to a Reuters report, the Nifty futures dropped as much as 6.7 percent in afternoon trade, dragging down spot indexes, which several dealers attributed to a trading mistake sparked by an attempt to sell both Infosys futures and index futures.

Among today losers were IDFC, Jaiprakash Associates, Ambuja Cements and Tata Power. Among the gainers in trade were Mahindra and Mahindra, Cipla, Wipro and Tata Steel.

Sentiments were also adversely affected after global investment bank, UBS downgraded Indian equities to "neutral" from "overweight". The bank has said that China was a better bet than India.

Shares of MRPL were down more than 5%, after the company shut down its plant due to water shortage. Banks which announced cut in rates continued to drift lower on selling pressure.

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