The Sensex was trading lower by 148 points, while the Nifty dropped 54 points in opening trade. Among the top losers in trade from the Nifty were JP Associates, Reliance Infra, Ultra Tech Cement, PowerGrid and ACC.
Among the top gainers in trade from the Nifty were Gail, Dr Reddy's, Tata Motors, M&M and Tata Power.
SBI is the biggest contributor to the decline, shares down 1.18%, followed by HDFC down by 1.10%
Among sectoral indices on BSE, all sectoral indices are in red with the realty and banking indexes leading losses.
Realty stocks continue to slide with Shobha Developer, Oberoi Realty, HDIL, DLF, Anant Raj and Godrej Properties all falling in trade.
PSU banking stocks too continued to decline with prominent losers from the space being Allahabad Bank, Andhra Bank, Indian Overseas Bank, Oriental Bank, Union Bank and Syndicate bank.
Meanwhile, markets in Asia fell sharply led by losses in the Chinese Shanghai Composite and the Hong Kong's Hang Sang.