In early trade on Tuesday, the Sensex fell more than 1,000 points, while the NSE Nifty fell below the critical 17,000-level, echoing a meltdown in global financial markets.

The Sensex was down 1,015 points, or 1.76%, at 56,668.60, while the Nifty was down 285.40 points, or 1.66%, at 16,921.25, extending their losses to the fifth session in a row. The Sensex’s 30 components were all trading with hefty losses.

“Escalations in Ukraine tensions with Russia recognising two pro-Russian rebel regions have aggravated the crisis. The economic consequences are already visible in higher crude and gold prices,” VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said.

The biggest macro headwind for India is crude racing to USD 97 a barrel, he said, adding that the inflationary consequence of this will force the RBI to abandon its dovish monetary stance.

Foreign institutional investors sold shares worth Rs 2,261.90 crore in the Indian stock market on Monday, according to exchange data.

Other Asian bourses followed Wall Street’s overnight loss and big selloffs in European shares caused by the Russia-Ukraine confrontation on Tuesday.

Russian President Vladimir Putin has recognized the independence of separatist regions in eastern Ukraine, escalating the geopolitical turmoil in the region.

Putin’s declaration follows a meeting of the Presidential Security Council and clears the way for Russia to publicly commit troops and weaponry to the long-running battle between Ukrainian forces and Moscow-backed rebels.

Meanwhile, India has voiced grave worry about the escalation of tensions along the Russia-Ukraine border, claiming that the events have the potential to disrupt regional peace and security.

In response to the Ukraine situation, Brent crude futures climbed 4% to USD 97.35, the highest level since September 2014. Rupee slumps 17 paise to 74.72 against the US dollar in early trade.