The 30-share BSE Sensex plummeted 3,380.59 points, or 10.31 per cent, to 29,397.55. It hit an intra-day low of 29,388.97, falling up to 3,389.17 points.
Trading was halted for 45 minutes in early session after the index hit its lower circuit limit.
The BSE and NSE benchmark indices, however, pared most losses with the Sensex trading 835.40 points, or 2.55 per cent, lower at 31,942.74, and the Nifty was down 253.25 points or 2.64 per cent at 9,336.90 at 1040 hours.
The mayhem on Dalal Street eroded investor wealth worth Rs 12,92,479.88 crore, taking the total m-cap to Rs 1,12,78,172.75 crore on the BSE at 1020 hours.
The m-cap of BSE-listed companies stood at Rs 1,25,70,652.63 crore at the end of trading on Thursday.
Traders said besides global selloff, incessant foreign fund outflows also weighed on investor sentiments.
On a net basis, foreign institutional investors sold equities worth Rs 3,475.29 crore on Thursday, data available with stock exchanges showed.
On the BSE, 1,279 scrips declined, while 193 advanced and 40 remained unchanged.
Volatility heightened in global markets as benchmarks world over went into panic mode, insinuating a freakish selloff.
Bourses in Shanghai dropped over 3.32 per cent, Hong Kong 5.61 per cent, Seoul 7.58 per cent and Tokyo cracked up to 7.97 per cent.
Wall Street lost 10 per cent in overnight trade.
More than 1,30,000 cases of the novel coronavirus have been recorded in 116 countries and territories, killing at least 4,900 people.
The number of coronavirus patients in India has risen to 74, as per health ministry log.