The Sensex ended 227 points lower, dragged down by global cues. But the benchmark index recovered from its highest intraday loss of 792 points, following a sharp pullback by the realty and banking stocks. 

The broader index Nifty ended 2 per cent lower at 3269 levels.

Among other key indices, BSE Small cap index lost 2.44 per cent but CNX Midcap index ended marginally in the red.

“ The markets would remain choppy on both sides. But certain frontline stocks recovered significantly because traders bought them as they are attractively valued at this point,” said  Kaushal Shah, Deputy Head of Research, LKP Shares.

Realty index on the BSE was the top gainer among the sectoral indices. It surged over 5 per cent to end at 2,813 levels. Major gainers in the pack were DLF, HDIL and Unitech, all up over 7 per cent.

The banking stocks recovered on softening inflation. The inflation for the week ended October 4 dipped to 11.40 per cent, from 11.8 per cent a week earlier. Adding to the positive sentiment of the banking stocks were the CRR cut, which was effected on Wednesday. Indian Overseas Bank was biggest gainer among the banking stocks, up 8 per cent. The other major gainers were Union Bank of India, Canara Bank and IndusInd Bank.

A rout in the global markets and the India stock market regulator's decision to tighten margins in the derivatives segment weighed on the domestic bourses today.

In the Sensex pack, RCom was the top gainer. It advanced 9.8 per cent. Other prominent gainers were DLF, HUL and SBI.

Major losers among the Sensex stocks were Hindalco and Tata Motors, down over 11 per cent each.

Sensex heavyweight RIL tumbled over 12 per cent today at its intra-day low of Rs 1327 but recovered slightly to close at Rs 1397, down 8 per cent.

Asian stocks tumbled on Thursday, with Tokyo's market plunging more than 11 percent, after another dive on Wall Street as worse-than-expected data about the US economy heightened fears of a global recession. European stocks were also trading sharply lower.