Equity benchmark Sensex plummeted over 3,000 points and the broader Nifty sank below 9,500 level (intra-day) on Thursday as worsening rout in world markets, after WHO declared coronavirus a pandemic, flared up fears of a global economic recession.
The rupee too plunged 82 paise to 74.50 against US dollar in morning session.
The selloff picked pace after the World Health Organization (WHO), late Wednesday night, termed the new coronavirus outbreak as a pandemic, and expressed deep concern over the "alarming levels of inaction".
Following the announcement, US President Donald Trump suspended all travel from Europe, excluding the UK, to the US for the next 30 days to stop the spread of the virus.
Brent crude oil futures plunged over 5 per cent to USD 34 per barrel, after the travel ban.
Continuing its downward spiral, domestic BSE Sensex sank 1,821.27 points at open. The 30-share index was trading 1,652.54 points, or 4.63 per cent, lower at 34,044.86 in morning session.
Similarly, the NSE Nifty cracked 486.75 points, or 4.65 per cent, to 9,971.65.
In the previous session, the 30-share BSE barometer settled 62.45 points or 0.18 per cent higher at 35,697.40, and the Nifty closed 6.95 points or 0.07 per cent up at 10,458.40.
On a net basis, foreign institutional investors sold equities worth Rs 3,515.38 crore, while domestic institutional investors bought shares worth Rs 2,835.46 crore on Wednesday, data available with stock exchanges showed.
All Sensex components were trading in the red. Tata Steel was the top loser, tanking up to 9 per cent, followed by ONGC, SBI, Titan, Axis Bank, M&M, UltraTech Cement, L&T and Reliance Industries.
According to traders, volatility peaked in global markets after WHO's announcement describing the coronavirus outbreak as a pandemic.
Besides selloff in global equities, massive plunge in international oil prices and depreciating rupee added to investor concerns, they added.
Incessant foreign fund outflow also spooked market participants, traders said.
Elsewhere in Asia, bourses in Shanghai dropped over 1.34 per cent, Hong Kong 3.66 per cent, Seoul 4.29 per cent and Tokyo cracked up to 5.32 per cent.
In overnight trade, US equity benckmarks also plunged nearly 5 per cent, intensifying the global rout.
The new coronavirus that first originated in the Chinese city of Wuhan in December last year has claimed over 4,200 lives and infected more than 117,330 people across 107 countries and territories. China remains the hardest-hit with over 80,000 infections and 3,000 deaths.