All major sectoral indices also caught in bear trap with BSE Metal and Oil & Gas being the prominent losers with 2 percent loss.
After a week of pain, bulls made a comeback on the D-Street on March 1 but were once again ushered out by the bulls after two new cases of coronavirus emerged in India. Benchmark indices witnessed a flash sell-off in the last hour of trading to end the session in the red.
The BSE Sensex erased 939 points from day's high to close at 38,144.02, while the Nifty50 shed 300 points from intraday high to close at 11,132.80.
The market breadth also turned in favour of bears in the last hour of trade as about three shares declined for every two shares rising on the BSE.
All sectors ended in the red with BSE Metal and Oil & Gas falling over 2 percent each.
More than 340 BSE stocks hit fresh 52-week lows. These include ACC, Ashoka Buildcon, Apollo Tyres, Bank of Baroda, Canara Bank, GAIL India, Hero Motocorp, Hindalco, Hindustan Zinc, IndusInd Bank, L&T, M&M, Marico, NBCC, NTPC, Oil India, PNB, Vedanta among others.
Experts say that coronavirus would remain the focal point throughout the week.
"The Indian markets have outperformed global peers in the recent rout mainly due to lower crude oil prices and no addition in coronavirus cases in the country. However, with two new cases reported today, we believe the outperformance could reduce in the near term. Globally, market sentiments would be dictated with the news and update on the spread of coronavirus cases," Ajit Mishra, VP - Research at Religare Broking told Moneycontrol.
He advised sticking to quality names and invest in a phased manner.
According to experts, Nifty could see a fresh rally if it consolidates in the range of 11,000-11,100 levels for a few more days.
"There is a need for a smart pullback in global market otherwise psychological level of 11,000 is under threat where 10,700 would be the next important support level. For upside, 11,450-11,700 are important resistance levels," Santosh Meena, Senior Analyst, TradingBells said.