The BSE benchmark Sensex tumbled by 223 points to a nearly three-week intra-day low of 15,658.16 in early trade on Thursday due to persistent selling pressure amid sustained foreign fund capital outflows and weak Asian cues.
The 30-share Sensex resumed lower at 15,739.05 and hovered in a range between 15,795.84 and 15,655.64 before quoting at 15,658.16 at 1015 hours, a net loss of 222.98 points, or 1.40%, from its previous close.
The NSE's 50-share Nifty index was also down by 62.65 points, or 1.32%, to 4,700.60 at 1015 hours.
Metal stocks declined after data showed that Chinese manufacturing activity continued to contract in December, 2011, with Sterlite Industries, Hindustan Copper, Steel Authority of India (Sail) and JSW Steel hitting 52-week lows.
The major losers in early trade were Bharti Airtel (down 3.97%), Hindalco Industries (3.69%), Maruti (3.47%), Larsen (3.06%), BHEL (2.94%) and Sterlite Industries (2.88%).
Foreign institutional investors (FIIs) sold shares worth Rs 140.13 crore yesterday, as per provisional data from the stock exchanges.
Asian stocks fell for a third day today as the latest data on manufacturing activity in China and Japan highlighted weak conditions in Asia's two largest economies even as growing funding stress in Italy stoked concerns that Europe is losing its fight to contain the debt crisis.
The key benchmark indices in China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan were down by between 1.03% and 1.84%.