Among the top losers were Kotak Mahindra Bank, Indiabulls Housing Finance, Reliance Industries, UltraTech Cement and Bharti Airtel.
The BSE benchmark Sensex nosedived 713 points to end at 34,959, while the Nifty fell to 10,488, down 205 points or 1.9 per cent Across-the-board selling, led by banking, financial services and energy stocks, dragged the broader markets lower.
Among the top losers were Kotak Mahindra Bank, Indiabulls Housing Finance, Reliance Industries, UltraTech Cement and Bharti Airtel.
Markets witnessed a mayhem on Monday over weak global cues and the exit polls prediction.
The exit polls on Friday predicted a tight finish between the ruling Bharatiya Janata Party (BJP) and the Congress in Madhya Pradesh and Chhattisgarh, and a win for the opposition party in Rajasthan.
Kotak Mahindra Bank shares were the biggest drag on both the benchmark indices, after the private sector bank said it had challenged in court the Reserve Bank of India's decision to disregard the issue of preference shares to reduce promoter stake.
With a negative breadth, selling was visible across all sectors, with metals, infrastructure, automobiles, banks and pharmaceuticals being the top losers.
The Indian rupee slipped in the early trade, as it opened lower by 54 paise at 71.34 per dollar against previous close 70.80.
Opec meet and the arrest of Global CFO of Huawei has unnerved global investors. To add more to it, domestic state election results may just be the fuel for a short-term volatility, market experts said.Global crude oil prices rose after Opec members and 10 other oil producing nations agreed Friday to cut output by 1.2 million barrels a day in a bid to boost prices.
Energy ministers reached the deal, which takes effect from January 1 but has already sent prices surging on oil markets, after two days of talks at Opec headquarters in Vienna.
Brent crude, the international benchmark, was trading 0.68 per cent up at USD 62.09 per barrel. The rupee, meanwhile, depreciated 59 paise to 71.40 against the US dollar in early trade at the interbank foreign exchange amid strengthening of the US dollar against some currencies overseas.
On a net basis, foreign portfolio investors (FPIs) sold shares worth Rs 817.40 crore Friday, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 242.56 crore, provisional data available with BSE showed.
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 "Sensex closes 713 points lower, Nifty at 10,500")
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