The benchmark Sensex fell over 580 points on Monday over sustained outflow of foreign funds and poor global investor sentiments.
Global markets came under further stress after China vowed to respond to the US tariffs it announced last week, sending shockwave across world financial markets.
The Sensex was down 582.64 points to 36,535.58 during the early trade after it opened over 270 points lower at 36,842.17.
Following a sharp recovery on Friday after news that the government might intervene to arrest the fall in the markets, the Sensex closed at 37,118.22.
However, no such announcement has been made as yet.
At 9.44 a.m., the broader Nifty was trading 175.50 points or 1.60 per cent lower at 10,821.85.
It opened 98 points lower at 10,895.80 from its Friday's close of 10,997.35.
On the current market outlook, Prakash Pandey, Head of Research at Fairwealth Securities said, â€śCurrent market fall is caused by the weak global cues as trade tension between the US and China has further escalated and next round of Sino-US trade talks are due next month. Indian indices are already under the FPI selloff heat and this trade war escalation has further fuelled the bear run at Dalal Street.â€ť
Meanwhile, eight of the 10 most valued Indian firms faced a combined erosion of Rs 89,535 crore in market valuation last week.
For the week ended Friday, only Tata Consultancy Services (TCS) and Hindustan Unilever Limited (HUL) in the top 10 list saw gains in their market capitalisation.
Market capitalisation of State Bank of India and Reliance Industries Limited suffered the maximum erosion of Rs 30,388.30 crore and Rs 18,952.50 crore respectively.
Besides, HDFC Bank, Infosys, ITC, ICICI Bank and Kotak Mahindra Week ended last week with losses.
The super-rich tax has caused one of the worst ever outflow of foreign funds as it impacted the Foreign Portfolio Investors (FPIs).
Besides, the the Monetary Policy Committee (MPC) is widely expected to announced a rate cut amid a massive slow down in Indian economic activity.
With IANS inputs