After touching a low of 37,111.29, the 30-share index was trading 210.02 points, or 0.56 per cent, lower at 37,174.97.
Mumbai: Domestic equity benchmark BSE Sensex plunged nearly 300 points in early session on Monday, dragged by oil and gas stocks, stoked by a massive surge in global crude prices.
After touching a low of 37,111.29, the 30-share index was trading 210.02 points, or 0.56 per cent, lower at 37,174.97 at 1000 hours, while the broader Nifty fell 64.15 points, or 0.58 per cent, to 11,011.75.
In the previous session on Friday, the BSE barometer settled 280.71 points higher at 37,384.99, while the broader NSE Nifty ended 93.10 points up at 11,075.90.
According to experts, domestic equities plunged after global oil benchmark Brent crude price skyrocketed as drones attacked two Saudi Arabian plants on Saturday.
The attack by Yemen's Houthi rebels reportedly shut down six per cent of the global oil supply.
After the drone attack on one of the world's biggest oil producers Saudi Aramco, global crude prices surge by almost 12 per cent which is the biggest surge since 1988, said Ashish Nanda EVP and Business Head - PCG, Commodities and Currency Business, Kotak Securities.
"It would certainly impact emerging countries like India in the medium term as uncertainties will keep market sentiment volatile, he added.
The spike in crude oil rates will affect the fiscal position of net energy importers like India, experts said.
Shares of oil and gas companies HPCL, BPCL, IOC, Castrol India and Reliance Industries plunged up to 7 per cent.
A huge depreciation in the rupee against the US dollar too spooked investors here, traders said. The local unit cracked 68 paise to 71.60 against the US currency in early trade.
Top losers in the Sensex pack in early trade on included Asian Paints, RIL, Yes Bank, HDFC, SBI, Tata Motors, Maruti, Tata Steel and Axis Bank, falling up to 2 per cent.
On the other hand, ONGC, TCS, HUL, TechM, PowerGrid, Sun Pahrma, Infosys, ITC, HCL Tech and NTPC rose up to 2.45 per cent.
Meanwhile, Finance Minister Nirmala Sitharaman on Saturday unveiled over Rs 70,000 crore of measures for exporters and the real estate sector, including about Rs 30,000 crore new spending in plans such as setting up of a stressed asset fund, as part of efforts to boost economic growth from a six-year low.
Market participants are also eyeing wholesale price index (WPI) inflation data scheduled to be announced later in the day.
The decision on interest rates and the statement from the US Federal Reserve chief after Federal Open Market Committee's two-day meet (starting on Tuesday) would be most crucial news for global markets, experts said.
Elsewhere in Asia, Shanghai Composite Index and Kospi were trading in the green in their respective late morning sessions, while Hang Seng cracked 1 per cent.
On Friday, foreign portfolio investor sold shares worth a net of Rs 405.45 crore, while domestic institutional investors bought equities worth Rs 209.56 crore, provisional data showed.