The Sensex ended the day marginally lower by 46 points, while the Nifty lost 10 points to close at 4600 points. Among the shares from the S&P CNX Nifty that saw sharp rallies were Punjab National Bank, Bharat Heavy Electricals, Jindal Steel and State Bank of India.
Among the shares that lost ground from the index stocks in early trade were TCS, which continued to grind lower for the second successive day, Wipro, Cairn India and DLF.
Shares of retail companies which were in the limelight on Monday following the announcement of FDI in multi-brand ended the day lower. Pantaloon Retail, Provogue, Trent and Shopper's Stop all dropped in trade today.
Banking stocks, particularly the PSU banking stocks saw a smart jump. Allahabad Bank, Andhra Bank, Canara Bank, Oriental Bank and Union Bank of India jumped between 6-10% in trade today.
Shares of heavyweight Reliance Industries was subdued in trade an ended down by 2%.
Meanwhile, European markets were trading little lower following renewed fears over Spain. Indian markets would remain closed on September 19 for the Ganesh Chaturthi festival.