After opening on a firm note, stock markets slipped into the red on Thursday, with the Nifty falling below the 7,300-mark, while the Sensex was trading below 24,000, down over 100 points at about 12.40 pm.
The Sensex was at 23,933 points while the Nifty was trading at 7,268.
Stocks dragging the Nifty included Tata Motors, Maruti Suzuki, Dr Reddy's Laboratories, ONGC and Idea Cellular, while Ambuja Cements, Axis Bank, Ultratech Cement and ACC were trading with gains.
On the BSE, shared that were pulling the Sensex down were the same as Nifty, while gainers included Axis Bank, ICICI Bank, BHEL and Tata Steel.
The markets opened on a positive tracking Asian markets that rebounded after crude oil prices rose from the recent 12-year lows.
The question will be uppermost on the minds of many investors, given the stock market rout on Wednesday in India and elsewhere, after the International Energy Agency's (IEA) warning that oil market may "drown in oversupply", triggering a global sell-off in equities.
The S&P BSE Sensex breached the 23,000-mark for the first time since Narendra Modi came to power in May 2014 when his Bhartiya Janata Party (BJP) won a landslide victory in the Lok Sabha elections.
On Wednesday, the Sensex touched a 20-month low, correcting by almost 420 points, but later gained ground to end above 24,000. The Nifty, too, slipped below the 7,300-mark, but recovered to close the day at 7,309.30, down 1.29%.
The day marked another low when the Indian rupee breached the 68-mark to 68.07 against the US dollar, but recovered later to close at 67.96, a 28-month low.
The question is: Will there be value buying on Thursday or will bearish sentiments persist?
The triggers for a continued bearish phase are many â€” lower forecasts for world economy by IMF and World Bank, foreign institutional investors extending their selling spree, weak macroeconomic data and disappointing corporate earnings.
Given these circumstances, will the markets spring a surprise on Thursday, as they did on Tuesday, when the Sensex gained 291 points and the Nifty 84 points? After all, not much changed between Monday and Tuesday. In fact, markets shrugged off data from China that showed the world's second-largest economy grew at 6.9% in 2015 â€” the slowest pace in 25 years.
But the domestic headwinds are here to stay, with merchandise exports contracting for the 13th straight month in December 2015, a cause for worry since exports account for a fifth of the gross domestic product (GDP).
The country can take little comfort from falling crude oil prices.
"Commodities and crude oil prices have more than 40% bearing on India's exports. This has further led to continuous decline in exports," said S C Ralhan, president, Federation of Indian Export Organisations.
It would be challenging for the government to ensure the economy grows at 7-7.5% this financial year, and keep the fiscal deficit at 3.9% of the GDP. The country grew 7.2% in the first six months this fiscal.
Still, one can't rule out a rally, albeit a modest one, if investors resort to bottom-fishing since some of the frontline stocks, including Sensex heavyweights, are trading at record lows.
TCS, Apollo Tyres, Coal India, Canara Bank, State Bank of India, Punjab National Bank, Hindalco, Vedanta, ABB, Tata Chemicals and Bank of Baroda hit new 52-week lows on Wednesday.
Some of the Sensex losers, such as Reliance Industries, ICICI Bank, Tata Motors, Hindustan Unilever, Infosys, HDFC, Axis Bank, Larsen & Toubro and Maruti Suzuki, could bounce back after the sharp fall seen on Wednesday.
Of course, a lot will depend on global cues, especially the China factor.