Indian markets fell sharply on Tuesday, with the BSE Sensex losing over 700 points in intraday trade, only to partly recover and close 361.92 points lower at 38,305.41. The National Stock Exchange Nifty 50 lost 114.55 points, or 1%, to finish at 11,359.90.

The decline in the stock markets was attributable to losses in banking, realty and IT stocks following reports that the Economic Offences Wing of the Mumbai Police has filed a first information report against officials of Mumbai-based Punjab and Maharashtra Cooperative Bank and realty developer Housing Development and Infrastructure Limited. The shares of Yes Bank fell by over 22%, after fraud allegations against mortgage lender Indiabulls Housing Finance led to fears that lender had loan exposure to the company and the troubled housing finance sector.

Apart from Yes Bank, the biggest losers on the Sensex on Tuesday were IndusInd Bank, State Bank of India, Bharti Airtel and Coal India. On the Nifty 50, the top losers were Yes Bank, Zee Entertainment, IndusInd Bank, SBI and Grasim.

However, shares of HDFC Bank rose by 1.72% on the Sensex, following by gains for Mahindra & Mahindra, HDFC, Maruti Suzuki and Hindustan Unilever. The biggest gainers on the Nifty 50 were Bharat Petroleum Corporation Ltd, Mahindra & Mahindra, HDFC Bank, Maruti Suzuki and HDFC.

The rupee closed 21 paise lower at 71.08 against the United States dollar.

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