The Bombay Stock Exchange benchmark Sensex lost over 342 points at midsession on Wednesday, after opening on a strong footing, on continued selling by funds in heavy-weight stocks amid profit-taking at improved levels.
The 30-share index, which moved up by 102 points in early trade, slipped into the negative zone with a sharp fall of 342.81 points, or 2.54 per cent at 13,175.99 at 1400 hrs.
Similarly, the wide-based National Stock Exchange's index Nifty dropped by 100.30 points, or 1.99 per cent to 3,974.60.
Marketmen said major players including funds, who made sizeable purchases in early trade, turned sellers after European stock markets weakened.
They said funds as well as retail investors pressed heavy sales in pharma, banking, metals, oil and gas and capital goods.
Pharma giant, Ranbaxy stocks turned distinctly weak and lost 6.86 per cent to Rs 375.55 after the US regulator blocked the sale of more than 30 generic medicines made in two factories by the company because of "deficiencies in manufacturing processes."
India's largest private sector lender ICICI Bank crashed by Rs 59.65, or 10.09 per cent at Rs 531.70, HDFC Bank lost Rs 60.05, or 4.88 per cent at Rs 1,170, while country's largest lender State Bank of India fell by Rs 71.35, or 4.50 per cent at Rs 1,514.15.
Other prominent losers were, Reliance Industries, Sterlite Industries, Reliance Infra, RCom, Tata Consultancy Services, Tata Steel, Tata Power, Larsen and Toubro and BHEL.
Meanwhile, Foreign Institutional Investors (FIIs) have pulled out nearly USD 370 million from equity in the last two days.