Equity benchmark Sensex slumped over 350 points in early trade on Monday, tracking losses in index majors Tata Steel, HDFC twins and ICICI Bank amid thin trade in global markets.

The 30-share Sensex was trading 355.27 points or 0.60 per cent lower at 58,660.62. Similarly, Nifty fell 108.50 points or 0.62 per cent to 17,476.65 in initial deals.

Tata Steel was the top loser in the Sensex pack, sinking nearly 6 per cent, followed by Bajaj Auto, M&M, HDFC, PowerGrid and Maruti.

On the other hand, Tech Mahindra, HUL, HCL Tech and TCS were among the gainers.

In the previous session, the 30-share index settled 125.27 points or 0.21 per cent lower at 59,015.89, and Nifty slipped 44.35 points or 0.25 per cent to close at 17,585.15.

Foreign institutional investors (FIIs) were net buyers in the capital market as they purchased shares worth Rs 1,552.59 crore on Friday, as per provisional exchange data.

According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, markets are likely to turn volatile from now on.

"Possible tapering timeline from the Fed this week, rising bond yields in the US, strengthening dollar (dollar index above 93) and news of the crisis in the large Chinese real estate developer Evergrande are likely to weigh on markets," he said.

With valuations in stretched territory, corrections are possible, particularly in the broader market. On the positive side, FIIs continue to buy imparting resilience to markets. But this can quickly change. Investors may adopt a wait-and-watch strategy till clarity emerges, he added.

Elsewhere in Asia, Hang Seng was trading with steep losses. Bourses in China, Japan and Tokyo remained closed.

Meanwhile, international oil benchmark Brent crude slipped 0.66 per cent to USD 74.84 per barrel.