Benchmark indices slumped in trade, following drone attacks on Saudi oil and gas facilities. Crude oil prices jumped more than 18 per cent at one stage, but, gave-up some gains.
The sharp spike in crude oil, led investors to sell heavily into stocks, given that India is a major importer of oil and this could have implications on inflation.
The Sensex ended the day lower by 0.7 percent at 37,123.31, while the Nifty closed lower by 0.65 percent at 11,003.50. It was the worst fall for the two indices since 3 September. Leading the set of losers were the oil marketing company stocks, including the likes of HPCL, BPCL and Indian Oil.
A jump in crude oil prices tends to impact the margins of some of these companies. HPCL fell a huge 7.50 per cent, while BPCL lost more than 6 per cent and Indian Oil dropped about 2 per cent.
Reliance Industries shares fell in trade, as investors were worried of the deal with Saudi Aramco for a petchem stake, given the drone attacks on Saudi oil and gas processing facilities.
Housing Finance and real estate companies were in the limelight with the government creating a special fund to provide financing to the many stalled affordable and middle-income housing projects in the country.