Benchmark indices plunged in trade today, led by a plummeting rupee, which hit a new low of 72.67 against the US dollar.

Sustained losses in the currency, and comments by rating agency Moody's that the fall in the rupee was credit negative for India Inc, weighed on sentiments. There were also fears that a sharp fall in the rupee, could lead to even further increase in fuel rates from record highs, which could lead to the RBI hiking interest rates again on worries over inflation.

The Sensex ended the day with losses of 467 points, while the Nifty lost 151 points in trade. The currency market also impacted bond yields, which surged in trade, following a sharp drop in the rupee with yields hitting their highest levels since late 2014, with the 10-year yield rallying to 8.12 per cent. This led some banking stocks to fall.

The top losers from the Sensex were Sun Pharma, Vedanta, Mahindra and Mahindra and Dr Reddy's. However, software stocks saw some buying support with Infosys and Wipro among the gainers on a fall in the rupee.

Shares in Axis Bank jumped after a successor to Shikha Sharma was announced by the bank.

Meanwhile, the dollar was last seen trading at 72.25, after hitting a lifetime low of 72.67 against the dollar. Currency experts believe that the rupee may well breach the 73 levels mark in the coming week itself, though it is a truncated week for the markets.

European markets were trading with marginal gains. Indian markets are expected to be volatile ahead of data to be released in the next few days. IIP and CPI inflation data is expected on Wednesday, while markets would remain closed on Thursday for a festival.