Indian shares slumped on Monday to their lowest in nearly four months as raging global Omicron infections threatened to derail economic recovery, while Future Group stocks jumped after the country's antitrust agency suspended a deal with Amazon.com.
The NSE Nifty 50 index fell 2.4% to 16,574.55 by 0455 GMT and the benchmark S&P BSE Sensex dropped 2.4% to 55,672.49. Both the indexes have now declined more than 10% from their record highs in October.
The Netherlands went into lockdown on Sunday and the possibility of more COVID-19 restrictions being imposed ahead of the Christmas and New Year holidays loomed over several European countries as the Omicron variant spreads rapidly.
"The tempo got broken when the U.S. Federal Reserve changed its stance along with other global central banks last week. The Omicron variant is also troubling the markets as its transmission is higher than other variants," said Saurabh Jain, assistant vice president at SMC Securities in New Delhi.
"The fall is also a result of continuous selling by foreign institutional investors. The rollback of liquidity by central bankers will have some kind of repercussions."
Meanwhile, the Nifty volatility index, which indicates the degree of volatility traders expect over the next 30 days in the Nifty50 index, was up 10%.
The Nifty metals index and the realty index were the top losers, each down more than 4%.
Only five of the Nifty 50 constituents were trading in positive territory, with Cipla gaining 2.4% after it got approval from the U.S. federal health regulator for its Lanreotide injection.
Shares of Future Group companies surged about 20% after the country's antitrust agency suspended Amazon.com Inc's 2019 deal with the group, potentially making it easier for Reliance Retail to buy Future's retail business.
Shares of Shriram Properties listed in Mumbai markets at a discount of about 24%.