The 30-share Sensex, which closed 71.73 points higher in the previous session, fell by 102.54 points, or 0.60 per cent, to 16,774.52 in opening trade today.
In a similar fashion, the wide-based National Stock Exchange Nifty Index shed 35.00 points, or 0.69 per cent, to 5,027.60.
Brokers said apart from profit-booking by participants, the government's decision to suspend FDI in multi-brand retail also dampened the trading sentiment.
In addition, a weakening trend on other Asian bourses triggered selling on the domestic bourses, they said.
Stocks of Pantaloon Ltd tumbled by 2.60 per cent to Rs 193, while Trent Ltd fell by 0.23 per cent to Rs 956.
Meanwhile, in the Asia region, Hong Kong's Hang Seng Index was down by 0.79 per cent and Japan's Nikkei shed 0.77 per cent in morning trade today.