Experts believe volatility is here to stay for some time, at least till China stabilises and clarity regarding the US Fed's interest rate move emerges.
The Indian rupee touched record low of 65.52/dollar on Thursday and is down 16 per cent so far this year despite efforts by policymakers to prop it up.
Markets crashed due to domestic worries; bluechip stocks tanked too.
The S&P and Dow dipped the most in a day since September 28.
The progress on US debt ceiling talks, domestic inflation numbers and second quarter earnings of companies are expected to keep investors busy in the truncated trading week ahead.
SBI plunged over 3% after posting a 34.57% fall in net profit to Rs 2,538 crore for the quarter ended September 2016 on rise in provisions for non-performing loans.
The 30-share Sensex dropped 298 points to end at 27,209 and the 50-share Nifty has lost 93 points to end at 8,174.
'For investors who are willing to remain invested for two - three years, there exist quite a few good opportunities.'
ONGC was the top gainer which surged over 4% followed by Axis, SBI, CIL
Officials say a fall in global oil prices will reduce the government's subsidy burden, giving it a greater chance of hitting its ambitious fiscal deficit target of 4.1 percent of gross domestic product in the fiscal year to March.
RBI must balance the need for improving domestic bank credit demand and respond to lower inflation.
Slowdown and liquidity squeeze by RBI have put India's top 10 indebted firms in a tight spot. But they have a few options.
Where do the commodities market go in the new year? Sonali Ranade offers an insight.