The Sensex closed the day lower by 92 points at 21740 points, while the Nifty drifted lower by 41 points. Among the top Nifty losers were some of the banking stocks including the likes of Punjab National Bank, Kotak Mahindra Bank and HDFC Bank.
IT stocks were the top performers in trade after receiving a battering in the last few trading sessions. Infosys was up almost 1 per cent, while Tata Consultancy Services gained more than 3 per cent.
HCL Tech and Wipro were the other winners in trade from the software pack.
PSU banking stocks came in for some profit booking with the likes of Oriental Bank, Union Bank, Canara Bank and Bank of Baroda seeing severe selling pressure.
Shares in Spice Jet fell more than 2 per cent after the reports that The Directorate General of Civil Aviation (DGCA) had issued the company a show-cause, asking why its licence should not be suspended, after a video of the cabin crew on a Goa-Bangalore flight dancing in the aisles went viral on social media.
Mid cap stocks too fell in line with the broad markets largely on the back of fall in PSU banking stocks. Mcleod Russell, India Cements and IFCI were the major losers.
Meanwhile, Asian markets ended the day lower led by sharp cuts in the Indonesian Jakarta Composite, Hong Kong's Hang Sang and the Japanese Nikkei.