Axis Bank was the top loser in the Sensex pack, shedding over 4 per cent, followed by Asian Paints, SBI, IndusInd Bank, ICICI Bank, Bajaj Finance, HDFC and Reliance.
On the other hand, Bajaj Auto, Hindustan Unilever, UltraTech Cement, TCS, Bajaj Finserv and Infosys were the gainers.
Widespread profit-booking hammered stocks for the second straight session on Friday, with the Sensex tanking 746 points and the Nifty crashing below the 14,400-mark.
A day after touching the historic 50,000-level, the Sensex found it tough to sustain itself at higher levels as investors offloaded Reliance Industries ahead of its results, while banking and finance counters also bore the brunt of heavy selling amid lacklustre global cues.
The 30-share BSE benchmark tumbled 746.22 points or 1.50 per cent to finish at 48,878.54, posting its largest single-session drop in a month.
Similarly, the broader NSE Nifty slumped 218.45 points or 1.5 per cent to 14,371.90.
Axis Bank was the biggest laggard among the Sensex constituents, skidding 4.63 per cent, followed by Asian Paints, SBI, IndusInd Bank, ICICI Bank, Bajaj Finance, HDFC and Reliance Industries.
On the other hand, Bajaj Auto stole the show by surging 10.45 per cent, a day after it reported a robust 23 per cent jump in profit after tax at Rs 1,556 crore for the three months ended December 2020.
Hindustan Unilever, UltraTech Cement, TCS, Bajaj Finserv and Infosys were the other gainers, advancing up to 1.76 per cent.
On a weekly basis, the Sensex slipped 156.13 points or 0.31 per cent, while the Nifty shed 61.8 points or 0.42 per cent.
"Indian indices tumbled in afternoon trade dragged by weak global markets and selling seen in metal and banking indices.
“Positive outlook for auto and IT stocks helped them to retain their momentum even during today's correction.
"European markets fell today on weak UK retail sales numbers and increasing restrictions in the Eurozone, while Asian markets followed its European peers.
“The decisions taken in the upcoming Union Budget along with the policies of the new US government are expected to define momentum in the near term," said Vinod Nair, head of research at Geojit Financial Services.
Sector-wise, the BSE metal, bankex, realty, finance and energy indices dived as much as 3.77 per cent, while auto and IT rose up to 1.49 per cent.
In the broader markets, the BSE midcap and small-cap indices slumped up to 2.02 per cent.
Global markets were knocked off highs as gloomy macroeconomic data and rising COVID-19 cases weighed on risk appetite.
Elsewhere in Asia, bourses in Shanghai, Hong Kong, Seoul and Tokyo ended in the negative territory.
The rupee clawed back lost ground towards the fag-end of the session and settled with a marginal 2 paise gain at 72.97 against the US dollar, supported by easing crude oil prices.
Foreign institutional investors remained net buyers in the capital market as they purchased shares worth Rs 1,614.66 crore on Thursday, according to exchange data.