Mumbai: A benchmark index for Indian equities on Tuesday plummeted in afternoon trade, falling over 400 points, as traders stepped up selling amid negative global cues. Adding to the woes of the markets was a downgrade of India's largest lender, State Bank of India (SBI), by credit rating agency Moody's, over the bank's ability to manage capital in the likelihood of rising non-performing assets.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) opened at 16,081.77 points and fell 406 points or 2.51 percent to an intra-day low of 15,745.43 points.

Its previous close was 16,453.76 points.

The 50-scrip S&P CNX Nifty of the National Stock Exchange also fell almost 2.5 percent to a low of 4,728.3 points.

Broader markets were also subdued. The BSE midcap index was down 1.18 percent while the BSE small cap index was ruling 1.06 percent lower. The BSE 100 index was trading 1.84 percent down.

There were only a few gainers. Maruti Suzuki and L&T were the prominent of these. Top losers included Tata Motors, SBI, ICICI Bank, Coal India, ITC and RIL.

Global markets continued to be under selling pressure over fears of a possible debt default by Greece and the financial crisis spreading to other countries in the Euro zone.

Among Asian bourses, the Japanese Nikkei closed 1.05 percent lower at 8,456.12 points, while the Hong Kong's Hang Seng index was down a whopping 3.4 percent down at 16,250.27 points.

The Chinese markets were closed on account of a holiday. European markets too opened lower.

While Britain's FTSE was ruling 2.56 percent down at 4,945.49 points, the German DAX was trading 3.22 percent lower at 5,203.44 points.

The French CAC 40 was ruling 3.15 percent down at 2,834.76 points.