Indian shares fell more than 1 percent for a second straight session on Tuesday, as markets globally braced for a potential escalation in the Sino-U.S. trade dispute, while the rupee continued its downward spiral touching a fresh life-low.
China will ask the World Trade Organization next week for permission to impose sanctions on the United States, for Washington's non-compliance with a ruling in a dispute over U.S. dumping duties that China initiated in 2013, a meeting agenda showed on Tuesday.
The broader NSE Nifty ended down 1.32 percent to 11,287.50, while the benchmark BSE Sensex was down 1.34 percent at 37,413.13. Both indexes marked their worst closing levels since Aug. 2.
The rupee hit a new low of 72.7500 to the dollar in the session, further weakening from the record trough hit in the last session.
Financials and consumer stocks were top drags on the indexes, with HDFC Bank Ltd falling 2 percent, while ITC Ltd ended 3.1 percent lower.