The muscle-flexing by the US and North Korea ratcheted up global worries and made investors a lot more anxious today, with the Sensex crashing 267 points to a one-month low and the Nifty below 9,900.
Both snapped back into loss for the fourth straight day.
The Korean peninsula pot kept boiling as North Korea upped the ante, defying the US President's "fire and fury" warning and threatening to strike its military base in Guam.
The markets have already been downbeat reeling under the regulatory clampdown after Sebi's Monday directive imposing trading restrictions on suspected shell companies.
After opening lower, the Sensex recovered, but only to slip again to hit a low of 31,422.80 before settling down 266.51 points, or 0.84 per cent, at 31,531.33. The level was last seen on July 7 when it ended at 31,360.63.
The gauge had lost 527.57 points in the previous three sessions.
The Nifty ended the day at 9,820.25, down 87.80 points, or 0.89 per cent.
Lower-than-expected earnings by Tata Motors, Eicher Motors and a few others soured risk appetite. Tata Motors emerged as the top loser among Sensex constituents by slumping 8.60 per cent after the company's June quarter earnings failed to meet market expectations.
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