The Sensex was trading lower by 8 points, while the Nifty lost 10 points in early trade.
Shares of Bajaj Auto were trading marginally higher at Rs 2130 ahead of its results to be declared later today. Tata Motors which was the best Sensex performer last year, shed 1 per cent after the global vehicle sales of the auto giant in December 2012 stood at 98,968 vehicles, down 13.9 per cent from a year earlier
Reliance Industries was trading higher after reports that the Oil Ministry may consider the Rangarajan panel recommendation of mandating a price of about $ 8-8.5 for natural gas.
IT stocks which have been rallying sharply following the results of Infosys came in for some selling pressure. Infosys shed 0.40 per cent, while TCS shed 1.40 per cent in early trade.
Among the other Nifty stocks that lost ground were HeroMotorCorp, DLF, HDFC Bank, IDFC and Hindustan Unilever. Bharti Airtel which appointed a new CEO also shed 0.40 per cent, after rallying sharply on Tuesday.
Bank Nifty saw some selling pressure with all of the Banks that form the index trading in the negative. Axis Bank, Kotak Bank, ICICI Bank, Yes Bank and Canara Bank all lost ground following reports of RBI governor Subbarao tempering rate cut expectations.
Metal stocks were trading mixed with Sterlite Industries and Sesa Goa gaining ground, while Tata Steel and JSW Steel were amongst the losers.
Meanwhile, markets in Asia were trading lower with the Chinese Shanghai Composite, The Hong Kong's Hang Sang and the Japanese Nikkei all lower in trade.
Markets are expected to trade in a range and would look for fresh cues from reform measures and the RBI's forthcoming policy meeting.