Indian equity benchmarks on Wednesday plunged sharply in late deals after Reserve Bank of India (RBI) announced a hike  in key interest rate.

In a surprise move, RBI raised the repo rate by 40 basis points (bps) to 4.40 per cent in an off-cycle meeting today.

The 30-share BSE Sensex tanked 1,120 points or 1.97 per cent to 55,856

while the broader NSE Nifty moved 340 points or 1.99 per cent down to trade at 16,730.

Mid- and small-cap shares were weak as Nifty Midcap 100 fell 1.78 per cent and small-cap shed 1.88 per cent.

All of the 15 sector gauges  compiled by the National Stock Exchange were trading in the red.

Nifty Consumer Durables and Nifty Financial Services were  underperforming the index by falling as much as 3.19 per cent and 2.32  per cent, respectively.

On the stock-specific front, Apollo Hospitals was the top loser as the stock cracked 6.43 per cent to ₹ 4,027.95.

The overall market breadth stood negative as 990 shares were advancing while 2,329 were declining on BSE.