Unwinding of long positions ahead of the derivatives expiry, coupled with profit bookings, subdued Indian equity markets during the late-afternoon session on Wednesday.
This led to a barometer index of the Indian equity markets to trade 73 points or 0.28 percent down during the late-afternoon session.
Initially, both the bellwether indices of the Indian equity markets opened on a flat note in sync with their Asian peers.
Nevertheless, expectations that Nifty will breach the 8,000-level mark and a positive close of the US markets on Tuesday due to healthy consumer confidence data pushed up prices.
However, markets soon ceded their gains, as lack of investors' participation coupled with unwinding of long positions ahead of the futures and options (F&O) expiry depressed sentiments and prompted some investors to book profits at higher levels.
Latest data with the stock exchanges showed that the volumes in cash markets across key bellwether indices eased to Rs.17,000 crore on Tuesday.
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Besides, investors were seen cautious regarding the upcoming third-quarter earnings season which starts from January 14.
The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) was trading lower by 73 points, or 0.28 percent.
The wider 50-scrip Nifty of the National Stock Exchange (NSE) was trading slightly in the red. It was down by 15 points, or 0.19 percent, at 7,914.25 points.
The Sensex of the S&P BSE, which opened at 26,123.87 points, was trading at 26,006.33 points (at 2.55 p.m.) -- down 73.15 points or 0.28 percent from the previous day's close at 26,079.48 points.
The Sensex has so far touched a high of 26,130.20 points and a low of 25,997.87 points during the intra-day trade.
"Unwinding of long positions ahead of tomorrow's F&O expiry and profit booking at higher levels dented markets," Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
Vaibhav Agarwal, vice president and research head at Angel Broking elaborated markets continue to trade flat on the back of low volumes, and in the absence of any major trigger.
"The broader markets are however performing better than the benchmarks with breadth in favour of the advances," Agarwal said.
"We expect volumes to remain low over the coming few sessions and markets to continue to remain lacklustre. Corporate earnings and the economic data would be the next major triggers for markets."