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After tumbling 800 points on Thursday and wiping off Rs 3-lakh crore of investor wealth, the markets resumed their journey south on Friday after a firm start. From their peak levels, the S&P BSE Sensex and the Nifty 50 index have lost nearly 24% till date.

Given the magnitude of fall in the Indian benchmarks on the back of a host of global and domestic factors, analysts suggest that the pain is not likely to go in a hurry. They expect the indices to dip further in case the global macros do not stabilise.

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A K Prabhakar, head of research, IDBI Capital, says: "In case the correction across global markets picks up pace, we can expect the Nifty to hit 6,357 levels, which is the high level of 2008. The fall in the markets does seem to be a repeat of 2008.

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"A lot of global indices have breached their two-year low levels on the downside. The only index that was sustaining was the Dow Jones Industrial average (DJIA), and that too has started to slide since the past few sessions. If it goes below 15,370 levels, then there are chances that it can tumble another 25% - 30%. As a result, the other global indices are also likely to follow suit. The rupee, too, can hit 72 levels against the US dollar in such a scenario," he adds.

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Deven Choksey, MD and CEO, K R Choksey Shares and Securities, however, believes that the markets are currently being driven by negative sentiment and are ignoring the positives in the system. There is value in select stocks but investors are not putting in money as the global environment remains negative.

"Market capitalisation to GDP ratio currently is around 0.59 : 1. In 2008, this ratio was 0.55 : 1. We believe that whenever the market is irrational in its behaviour, rationality follows thereafter," he adds.

So what should investors do in such a scenario?

Given the developments, Prabhakar says retail investors should not look to average out, at least for the next two - three months. On the contrary, they should wait for some clarity and stability to emerge in the global markets before putting in fresh money.

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"Taking money off the table will be a safer option rather than average the losses or put in fresh money at these levels," he advises.

"In this economic environment, further crisis in the stock markets and the banking sectorwould prove to be a disastrous one unless the RBI and the government take corrective measures. Whether they like it or not, the RBI and the government would be forced to understand the ground realities and ultimately implement flexible polices which would be conducive to the banking system, economy and the stock markets. Hence, we urge investors not to panic and offload the quality stocks, provided 30% of overall wealth is parked in liquid assets," says G. Chokkalingam, founder and managing director, Equinomics Research & Advisory.

Choksey advises assessing the fundamentals of the companies / corporate earnings before investing. "Investors need to be stock specific and invest where growth corporate earnings is visible," he says.