Weakness in the rupee owing to persistent demand for the American currency from importers has further dampened the sentiments. The rupee is currently trading at 63.86 against the US dollar.

At 12:15 PM, the BSE Sensex slipped around 2% or 528 points at 27,284 levels while the Nifty was at 8,214 levels, plunging nearly 2% or 167 points. Following the tandem, BSE Midcap and Smallcap indices are trading lower by 2.5% each.

Meanwhile, the Greek government has called a referendum on the latest proposals from the creditor institutions to be held on Sunday, 5 July.

All sectoral indices are trading in red with BSE Realty index being the biggest loser down 3%. BSE FMCG, Healthcare, Metal, Power and IT indices are down 2% each.

All 30 stocks in the Sensex pack are trading in the negative territory with Hindalco being the biggest loser, down 4%.

Oil prices fell in Asia today tracking the sell-off in global equity markets on fears of a Greek debt default. Tracking the development, shares of oil marketing companies (OMCs) are trading higher on the bourses. Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corporation (HPCL) and Indian Oil Corporation (IOC) are up 1-2% on the BSE.

Shares of metal companies are under pressure, with the National Stock Exchange (NSE) CNX Metal index hitting fresh 52-week lows in intra-day trades, after the Greek debt crisis worsened and Greece’s exit from the Euro zone seemed inevitable.

Hindalco Industries, Tata Steel, Jindal Steel & Power (JSPL), Vedanta, GMDC and National Aluminium have touched their respective intra-day lows on the NSE.

Banking shares are under pressure as Greece failed to clinch a deal with its international lenders over the weekend to avert a default.

State Bank of India (SBI), Bank of Baroda, Punjab National Bank, Federal Bank and Bank of India are down 4% each, while YES Bank, HDFC Bank, Kotak Mahindra Bank, IndusInd Bank, ICICI Bank, Canara Bank and Axis Bank are down 2-3% on the NSE.

Shares of companies having prominent revenue exposure to the eurozone are reeling under pressure as the possibility of Greece exiting the Euro zone increases with Greece set to default on its debt payment. Car maker and Index heavyweight Tata Motors has slipped 3%. Auto ancillary stocks Motherson Sumi and Bharat Forge have dropped 5% and 6% each.

Similarly IT outsourcers are suffering losses. Tech Mahindra, TCS, Wipro, HCL Tech and Infosys are down between 2-5%.

Union home ministry on Saturday clarified that it will not provide security clearance to Maran-owned Sun television network, confirming that many rules had been violated by the owners. The stock is down 3%.

The Rajasthan government has laid claim on Cairn India's Barmer gas, making it difficult for the Anil Agarwal Group company to sell the fuel outside. Vedanta is trading 2.5% lower.

The market breadth is very weak with 443 advances versus 1,848 declines on the BSE.