The market regulator Sebi had relaxed the price bands from 8 per cent to 12% for 200 shares. Reflecting the crash-like scenario, the DSE index plunged 56.70 points to close at 876.60 points following free-fall in stock values.

Stock brokers said bear operators took an advantage of expansion of intra-session circuit-filter limit from 8 to 12% and hammered down prices of majority of stocks.

They said reports that mutual funds sold heavily to meet increased redemption pressures too triggered nervous-selling.

Tuesday's crash was widespread with market-favourites in recent times such as IT, telecom and media company stocks remaining badly hit, they added.Influenced by reports that Finance Ministry has initiated an investigation into stock market related activities of some dotcom companies including mergers and acquisitions, market commenced on a weak note on renewed selling by operators and shares plunged to recent times low levels despite the FM denying such reports. "Every share was down and several were limit-down on bear hammerings", said a DSE broker, adding that "particularly hit were stocks of IT, telecom and media companies which have been market-favourites in recent times".

Prominent losers in the IT segment were Pentamedia Graphics at Rs 558.50 (Rs 634.40), Silverline Tech at Rs 372.70 (Rs 423.50), Satyam Computer at Rs 2738.65 (Rs 3101) Aptech at Rs 800 (Rs 905), DSQ Software at Rs 773.30 (Rs 867), Digital Equipment at Rs 526 (Rs 591) and Rolta at Rs 326.50 (Rs 366.75) and locked at the lower end of price band after exhausting daily price movement limit of 12%.

Other stocks such as Wipro at Rs 2944, NIIT at Rs 1928, SQL Star International at Rs 71.65, SSI at Rs 2375, and Tata Elxsi at Rs 100.90 also retreated on selling.

Telecom major Himachal Futuristic at Rs 733.75 (Rs 834.10) and Global Telesystems at Rs 1034.75 (Rs 1172) also hit lower end of price band on all-round selling.