The Sensex ended the day lower by 89 points (provisional), while the Nifty ended the day lower by 24 points. Apart from software stocks, other stocks that saw buying interest were Tata Steel, NTPC and Maruti.
Reliance Industries, which reported a good set of numbers ended the day with marginal gains, after having rallied substantially in morning trades.
Banking shares once again dragged the markets lower with shares from the sector dropping sharply, following a higher then expected CPI and WPI inflation data.
Shares that lost ground in trade were Canara Bank, IndusInd Bank, bank of India and Axis Bank. HDFC Bank which reported a good set of numbers also dropped in trade.
Wockhardt was locked at the lower end of the circuit filter for a second day in a row.
Mid cap stocks, which had rallied substantially in the last few trading sessions lost ground and ended the day lower.
Havells India was down almost 3 per cent, while Oriental Bank too lost 3%. The notable gainers, however, were JSW Steel and Jubilant Foodworks.
Fortis Healthcare rallied after reports that it will divest its stake in Bupa for $355 million. Tata Motors which has rallied significantly in the last few days shed gains in trade.
Meanwhile, markets in Asia ended the day higher, apart from the Chinese Shanghai Composite, which ended the day marginally lower in trade.