Elsewhere in Asia, Kong’s Hang Seng lost 1.73 per cent, Japan’s Nikkei shed 0.56 per cent, while Taiwan plunged 1.33 per cent.

Mumbai: The Sensex on Thursday hit its lowest level in three months, crashing over 806 points to close below the 35,200-level as concerns over weakening rupee and rising crude prices spooked investors.

Similarly, Nifty cracked the 10,600-level by falling 259 points.

The rupee plunged to an all-time low (intra-day) of 73.81 to the US dollar and global crude oil prices touched a four-year high of $86 a barrel, triggering worries for India on the macro-economic front.

The weakness in other Asian markets and a lower opening of the european shares also added to negative sentiments on the domestic bourses.

“The strongest of businesses and the bluest of blue chips have cracked in the last couple of sessions, which highlights the prevailing negative sentiment and environment of pessimism. With the rupee hitting record low, crude prices moving northwards, increasing fears of a broadening current account deficit along with the liquidity worries led to another major fall in the indices...” Devang Mehta, head of equity advisory at Centrum Wealth Management, said.

A sharp plunge mainly in healthcare, IT, oil&gas, banking and auto pulled the Sensex lower by 806.47 points, or 2.24 per cent, to 35,169.16 points, extending losses for the second day. Intra-day, it hit a low of 35,022.12.

“Anxieties over the Reserve Bank of India (RBI) adopting an aggressive stance in its monetary policy due to a rise in inflationary pressure led to an erosion in investors’ risk appetite. With deteriorating macros, all eyes will now be on the second quarter earnings and how the current liquidity situation is addressed,” Mehta said.

Elsewhere in Asia, Kong’s Hang Seng lost 1.73 per cent, Japan’s Nikkei shed 0.56 per cent, while Taiwan plunged 1.33 per cent.