The 30-share BSE Sensex closed at 50,792.08, lower by 487.43 points or 0.95 per cent. During the trade, it plunged 741.08 points to 50,538.43.
Following the weak sentiment, the market capitalisation of BSE-listed companies tanked by Rs 1,37,590.62 crore to Rs 2,07,89,062.84 crore.
"Indian markets failed to hold on to its strong start as rising bond yield countered positive sentiments," said Vinod Nair, Head of Research at Geojit Financial Services.
Bajaj Auto was the biggest loser in the Sensex pack, falling 3.10 per cent, followed by Maruti, ICICI Bank, Sun Pharma, Reliance Industries and UltraTech Cement.
In contrast, five frontline companies from the 30-share pack closed in the green -- PowerGrid, Titan, ONGC, Infosys and Bajaj Finance Limited, rising up to 2.28 per cent.
In the broader market, the BSE midcap index fell 0.45 per cent, while smallcap rose by 0.14 per cent.
BSE auto, energy, bankex, finance and FMCG closed up to 1.60 per cent lower.
"Markets ended lower amid excessive volatility, in continuation to the prevailing consolidation phase. Initially, the benchmark opened firm, tracking upbeat global cues however surge in bond yields impacted sentiment as the day progressed," said Ajit Mishra, VP - Research, Religare Broking Ltd.
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