The key index of the Indian equities markets displayed the worst perfomance of the recent weeks. The trade on Monday ended nearly with 870 points down from its last closing figure, as investors blamed lack of policy announcements and increase in minimum alternate tax on corporate for the negative reaction. 

The benchmark index of the Bombay Stock Exchange (BSE), the Sensex, which opened at 14,962.12 points, closed at 14,043.4 points - 869.65 points or 5.83 % lower than Friday's close. 

At one point, it had slipped by more than 900 points. 

"The stock markets have voted on the tax budget presented today. However, I believe that this fall could be attributed partially to the markets having run up on the back of disproportionate expectations," said chief executive of KPMG India Russell Parera. 

Similarly, the S&P CNX Nifty of the National Stock Exchange (NSE) ended the day 5.84 % down to 4,165.7 points. 

Broader market indices also closed in the red, with the BSE midcap index ending 5.17 % down, and the BSE smallcap index closing 4.5 % lower than its previous close. 

"The budget proved to be a low-on-deliverance affair and this was magnified on account of the huge expectations that the market had built from it," said Angel Broking chairman and managing director Dinesh Thakkar.

"Amongst the many shortfalls in the budget, it was silent on the timeline for tackling the fiscal deficit position of the country," added Thakkar.

The market breadth was negative with about 551 stocks advancing, 2,020 declining and 62 remaining unchanged.

"A number of expected policy initiatives like insurance liberalization and disinvestments will likely end up as announcements during the year as the various ministries seek to deliver on their governance agenda," said Parera.

There were only two gainers among the 30 scrip Sensex: ITC, up 3.13% at Rs.197.80 and Hindustan Unilever, up 0.99% at Rs.275.90. 

Among the losers were Reliance Infra, down 12.47 % at Rs.1,131.05, ICICI Bank, down 10.09 % at Rs.678; Jaiprakash Associates, down 9.93% at Rs.193.10; and Tata Steel, down 9.55 % at Rs.396.45. 

"Overall, while the budget did not stand true to all of market expectations, we expect that the government's efforts will continue outside the budget also and will help improve corporate India's earnings. We expect the stock market to reflect this improvement in earnings," said Thakkar. 

In other European markets, a key British index, the FTSE 100 was ruling in the negative terrain, down 54.64 points at 4,181.64 points while its French peer CAC 40 was down by 55.55 points and was at 3,063.96 points.