Mounting worries that Greece would default on loans and hence exit the Eurozone, saw heavy selling pressure across global markets, leading to a fall in Indian benchmark indices.
The Sensex closed the day lower by 166 points, while the Nifty dropped 62 points in trade. The Greece government has called for a referendum on July 5 to ask the people to say "yes" or "no" to creditors demands for further austerity cut in exchange for loans.
Leading the set of losers from the Nifty were banking stocks with State Bank of India, Axis Bank, ICICI Bank and HDFC Bank seeing cuts.
Tech stocks turned weak after Tech Mahindra sounded a warning on top line and margin likely to be hit the quarter. The stock ended lower by a huge 8 per cent, while also having a sentimental impact on other IT stocks like Infosys and HCL Tech.
Mid cap stocks also had a bad day with Bharat Forge falling a huge 6 per cent, while other stocks like Havells, JSW Energy, Mind Tree, Motherson Sumi and Apollo Tyre were among the major losers.
TV 18 ended the day down almost 6 per cent on reports that the company will not renew ten year brand licensing and news services arrangement with CNN.
BPCL and HUL were among the few stocks that managed to gain ground in trade and were resilient to the sharp fall.
Meanwhile, global markets plunged sharply in trade with the Shanghai Composite losing more than 3 per cent, while the German DAX and French CAC were also down 3 per cent each on worries over Greece.