India, Sept. 25 -- A surging oil market, historic highs in US yields, and a regulatory shake-up in domestic insurance combined to trigger a broad sell-off in equities on Thursday, with India faring among the worst in Asia.

Brent crude oil crossed $106 a barrel and US treasury yields rose to their highest in nearly 20 years, while a proposed insurance overhaul cast a cloud over the distribution incomes of Indian banks. Financial services account for 36.47% of the Nifty's weight, making the sector a key driver of the benchmark.

The Nifty and Sensex fell 1.6% and 1.7% respectively, hitting their lowest levels since 6 April and 8 June. The India Vix jumped nearly 23% as volatility shot up. In other markets, the Shanghai Composite fell 1.2%,...