The Bombay Stock Exchange benchmark index plunged by 323 points in early trade on Friday on heavy selling by funds in line with weak global markets.
The 30-share index, Sensex, which had gained 564.21 points in the previous two trading sessions, lost 322.88 points at 14,032.87 following steep fall in RCOM, DLF Ltd and other heavy-weight stocks.
Similarly, the wide-based National Stock Exchange' index Nifty fell by 97.25 points at 4,235.70.
Stock brokers said reports of weak trends in global markets and a moderate rise in inflation rates, which rose to 11.98 per cent for the week ended on July 19, mainly dampened the trading sentiments.
Hong Kong share market was down 1.5 per cent in early trade, tracking Wall Street falls.
Stocks of RCOM were distinctly weak and traded Rs 63.65, or 12.73 per cent lower at Rs 436.40 on major sell-off by funds.
Other major losers which dragged the Sensex down were Reliance Infra, Reliance Industries, State Bank of India, ICICI Bank, HDFC Bank, HDFC Ltd, BHEL, Larsen and Toubro, Tata Steel, Tata Motors, Maruti Suzuki, TCS and Bharti Airtel.