Selling in the last hour on expiry day dragged down Indian markets on Thursday. The benchmark Sensex index closed over 320 points lower after Brent crude oil touched $75 a barrel for the first time since October, stocking among investors worries of higher inflation and fiscal slippage.

The benchmark S&P BSE Sensex fell 0.83% to close at 38,730.86. The NSE Nifty 50 index dropped 0.72% to end at 11,641.80 points.

Brent crude hit $75 a barrel supported by the US decision not to renew sanctions waivers on Iran and curbs to Russian oil flows to parts of Europe. Crude oil gained for the fifth consecutive session and rose 5.3% in this period. Year to date, it has risen over 40%.

"Several factors such as monthly expiry in F&O for the April series, election outcomes in May, a strong dollar and global oil mania clouded sentiment of market participants today," said Umesh Mehta, head of research, Samco Securities.

Brokerage firm Choice Broking expects that at this juncture, due to positive earnings and volatile crude oil and election uncertainty, one needs to be extremely stock specific by following a proper exit strategy.

"This volatility indicates caution among participants and it’s not going to subside soon. Mixed earnings announcements combined with weak global cues are currently weighing on sentiment. Besides, the recent surge in crude oil has caused the situation to deteriorate further. We advise option strategies instead of naked longs in the futures segment. Investors, on the other hand, shouldn’t worry too much about these short-term whipsaws and must keep tabs on earnings announcements," said Jayant Manglik, president, retail distribution, Religare Broking.

Maruti Suzuki India Ltd fell 2.2% after the company reported a fall in net profit for the March quarter, hurt by industry-wide weak demand. The carmaker's net profit fell by 4.6% to 1,795.6 crore. The street had estimated the automaker to post a net profit of 1,747 crore during the quarter.

Other automobile firms also closed lower. Tata Motors fell 1.3%, Eicher Motors 1%, Mahindra & Mahindra 1% and Hero MotoCorp 0.6%.

"Maruti saw a sudden turn in its stock price as instead of a double-digit growth expectation in domestic sales, the company reported 6.1% growth, year on year. The management mainly attributed the 2% de-growth in its PAT to the robustness of other currencies vis-à-vis India, higher depreciation of the new plant and the reversal in trend among commodity prices. To add to it, its auto peers also offered steep discounts and Maruti followed suit," Samco Securities added.

Ultratech Cement Ltd rose 5% to 4,622.30 after the company reported strong performance for the March quarter. The company reported over 100% net profit growth to 1,017 crore from 488 crore a year ago. EBITDA rose 30% to 2,200 crore.