The 30-share Sensex on Tuesday fell by 287 points, or 1.8%, to close at 15,865, a day after it plunged 302 points, driven by weak global cues on fears of worsening euro zone debt crisis and local concerns after rating agency Moody's downgraded State Bank of India. The benchmark index of the Bombay Stock Exchange last dipped below the 16,000-mark on August 26.
"A fall in major global markets and plunge in banking stocks due to SBI downgrade pulled the market down," said said Alex Mathew, research head, Geojit BNP Paribas Financials.
The National Stock Exchange's 50-share Nifty index closed at 4849.5, down 77 points, or 1.6%. Shares of State Bank of India closed at Rs 1,787, down 76 points, or 4%. The banking index, Bankex closed down 3%.
The country's biggest private lender ICICI Bank also shed 4.6% to Rs 801. Axis Bank, HDFC Bank and Canara Bank lost 2.5 to 3% each. The auto sector index was the second worst performer, losing 1.9%.