Benchmark indices ended the day sharply lower as caution prevailed ahead of the US Federal Reserve Open Market Committee (FOMC) meet scheduled on Sept 16-Sept 17.
Investors sold shares on worries that a hike in interest rates in the US by the FOMC may trigger a fresh round of selling by Foreign Portfolio Investors.
Leading the set of losers in trade were steel stocks led by Tata Steel and Vedanta. The drop was despite a hike in import duty on certain steel products to protect the domestic industry.
Tata Motors, Hindalco and Larsen were the other losers in trade. Amtek Auto which had surged in trade in the last few trading sessions after infusion of capital by the promoters ended the day flat after witnessing heavy volatility.
Shares in Maruti gained ground after the Reserve Bank of India hiked the FII limit in the company. Other nifty gainers in trade were NTPC, Sun Pharma and Hindustan Unilever.
Midcap shares which began on a promising note lost ground with Bharat Forge falling a huge 6 per cent, while
Crisil, Concor and Indian Hotels falling between 3-4 per cent.
Meanwhile, markets across Asia ended the day lower, while most of Europe was trading with marginal losses ahead of the FOMC meet.