Indian equity benchmark indices witnessed a sharp selloff on Thursday as investors turned risk-averse amid firm crude oil prices and a global bond market rout, dragging banking and financial stocks lower.

The Sensex plunged 1,247.71 points, or 1.67 per cent, to close at 73,580.54, while the Nifty declined 383.70 points, or 1.64 per cent, to settle at 23,063.10.

Commenting on Nifty technical outlook, experts said that a sustained close below 23,000 could extend the downside toward the 22,900–22,800 zone, while 23,200 is likely to act as the immediate resistance during recovery attempts.

"Momentum indicators remain weak, with the RSI around 31, reflecting strong negative momentum and approaching oversold territory. The MACD remains deeply in negative territory, confirming continued weakness," market watchers stated.

"On the options front, Call OI stands at around 23.84 crore versus Put OI of around 17.23 crore, with significant Call OI visible around 23,200 and 23,500, while Put OI is concentrated around the 23,000 zone," analysts noted.

Weak sentiment was visible across the broader market, with selling pressure extending beyond frontline stocks. The Nifty MidCap index ended 2.25 per cent lower, while the Nifty SmallCap index fell 1.53 per cent.

Among the Nifty constituents, all but three stocks ended the session in negative territory. Bajaj Finance, HDFC Life Insurance Company and Axis Bank emerged as the top laggards, contributing significantly to the benchmark indices' decline.

Sectorally, financial stocks bore the brunt of the selloff. The Nifty Financial Services, Nifty Bank and Nifty Private Bank indices were among the worst-performing sectoral gauges as rising bond yields and global uncertainty weighed on investor sentiment toward the sector.

Defensive pockets of the market offered some resilience, although they too ended in the red. The Nifty Media and Nifty Pharma indices recorded comparatively smaller losses than the broader market.

Experts said that market participants remained cautious amid concerns over elevated oil prices and a global bond selloff, which fueled risk-off sentiment and prompted investors to reduce exposure to equities.