The Sensex S&P BSE Sensex falling 333 points or 1.27 percent to 25,932.01 and the Nifty down 104.80 points or 1.3 percent to 7849.50. The broader markets recovered sharply from day's low, down 0.3 percent.
Tata Motors (up 2 percent), State Bank of India (up over 1 percent) and Maruti Suzuki (up over 1 percent) rebounded amid market weakness.
Sun Pharma also cut losses to 4 percent from more than 6.5 percent seen in early trade post Q2 earnings. Dr Reddy's Labs lost 3.5 percent.
Shares of Infosys, HDFC, ICICI Bank, HDFC Bank, Reliance Industries, L&T, ONGC and Bharti Airtel were down 1-2 percent.
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