The Sensex was trading lower by 61 points, while the Nifty shed 19 points in trade. Among the early losers from the Nifty were Bharti Airtel, Dr Reddy's Labs, Hero Motor Corp, State Bank of India, Tata Steel and Tata Consultancy Services.
Stocks that gained ground were Infosys, Larsen and Toubro, Mahindra and Mahindra and Wipro.
Kingfisher Airlines rose in trade despite reports that the Directorate General of Civil Aviation has de-registered 15 aircraft of the company. The stock was up 0.60 per cent.
Clariant Chemicals gained 1.4 per cent after the company said it will sell its textile chemicals, paper specialities and emulsion businesses for Rs 209 crore.
Gail was among the top gainers from the Nifty despite the company lowering its full year targets for marketing and transmission of natural gas.
Mid Cap stocks continued to be pulled lower with the Nifty Mid Cap index down 0.55 per cent in early trade. Among the top losers from the space were Adani Enterprises, Aurobindo Pharma, GMR Infra, JSW Steel, Reliance Communications and IFCI.
Public Sector Banking stocks which came in for selling pressure over the last few trading sessions continue to dip with prominent losers from the space being Andhra Bank, Syndicate Bank and Oriental Bank of Commerce.
Real Estate stocks also had a bad beginning with DB Realty and DLF losing over 2 per cent. Other stocks from the sector that lost ground were Godrej Properties, HDIL, Unitech and Oberoi Realty.
Meanwhile, markets in Asia were trading lower with the Shanghai Composite losing more then 2.62 per cent, while the Hong Kong's Hang Sang lost 1.07 per cent in trade.
Indian markets are expected to be volatile ahead of the F&O expiry.