During the afternoon trade, Sensex fell over 700 points to breach the 37,000 mark for the first time since March this year.
The domestic stock market indices today traded in red led by the metal, pharma, bank, IT, infra, auto, FMCG and energy.
The BSE S&P Sensex closed 462.80 points down at 37,018.32 while the Nifty 50 down by 138 points to 10,980.
During the afternoon trade, Sensex fell over 700 points to breach the 37,000 mark for the first time since March this year. The Nifty was also below the 10,900 mark. The rupee also fell to a five-week low against the US dollar, tracking a broad surge in the greenback.
Indian stocks just suffered their worst July in 17 years as the disappointment with the Budget, muted corporate earnings, ongoing credit crunch and consumption remained a drag on sentiment.
Sensex and Nifty have lost 7.04% and 7.09% during the last one month, respectively. Sensex and Nifty have lost 2.53% and 2.90% in last one week.
The gainers were Wipro, Infratel, Power Grid and Maruti Suzuki.
Meanwhile, Cafe Coffee Day shares hit lower circuit for the third day in a row since CCD founder VG Siddhartha mysteriously disappeared and was found dead on Wednesday.