Banking and financial services shares were among the worst hit in today's session.

Highlights Banking and financial services shares were worst hit in trade today

State Bank of India slumped 7.7%, its biggest 1-day fall in 7 years

All sector gauges barring the IT index ended lower

The S&P BSE Sensex and NSE Nifty 50 indexes witnessed sharp declines in trade today paced by losses in banking and financial services shares as investors booked profits a day ahead of expiry of futures and options contracts for the month of September. Indian equity markets mirrored losses in global markets as world stocks fell to a two-week low and risk assets dipped lower on Wednesday after US lawmakers called for an impeachment inquiry into President Donald Trump, increasing the prospects of prolonged political uncertainty.

The Sensex ended 504 points or 1.29 per cent lower at 38,593.52 and the NSE Nifty 50 index dropped 148 points or 1.28 per cent to close at 11,440.20.

Banking and financial services shares were among the worst hit in today's session with the country's largest lender - State Bank of India falling 7.7 per cent, its biggest single-day fall since August 24, 2015.

"After nearly 1,000 point move in the Nifty some correction is happening on account of profit booking and the volatility is also high a day ahead of expiry of futures and options contracts tomorrow," AK Prabhakar, head of research at IDBI Capital told NDTV.

"Prospects of a prolonged political uncertainty in the United States after the launch of a formal impeachment inquiry against President Donald Trump are also hurting the equity market sentiment globally and that is also impacting Indian markets today," he added.

All sector gauges barring the IT index ended lower led by the Nifty PSU Bank index's 5.6 per cent fall. Nifty Realty, Nifty Auto, Nifty Financial Services, Nifty Private Bank and Nifty Metal indexes also dropped between 1.3-4 per cent each.

Mid- and small-cap shares also witnessed selling pressure as the Nifty Midcap 100 and Nifty Smallcap 100 indexes fell nearly 2 per cent each.

State Bank of India was top loser in the Nifty 50 basket of shares, the stock fell 7.7 per cent to Rs 279.30. Tata Motors, Yes Bank, Eicher Motors, Maruti Suzuki, ITC, Mahindra & Mahindra and Hindalco were also among the losers.

On the flipside, Power Grid, TCS, NTPC, Indian Oil, HCL Tech and Adani Ports were among the gainers.