The BSE benchmark index, which had gained 56 points yesterday, opened weak and traded in negative terrain for most of the session as metal, capital goods and bank shares were under pressure. The rupee, which slipped to near 56-levels against the US dollar, also made investors cautious.
A nearly 3.6 per cent drop in ICICI Bank shares, and L&T, which lost nearly 3 per cent weighed down the 30-share Sensex. RIL, which shed one per cent, also soured the sentiment.
The Sensex ended 127.53 points, or 0.73 per cent, down at 17,313.34, its lowest closing since August 3.
Likewise, the 50-share National Stock Exchange index fell by 48.30 points, or 0.92 per cent to close at 5,225.70.
"Metal shares declined following weakening in global commodity prices. Jindal Steel & Power and Hindalco hit 52- week lows. Selling pressure continued in capital goods on concerns over economic slowdown and consequent delay in execution of major power projects," said Nidhi Saraswat, Senior Research Analyst, Bonanza Portfolio.
Traders said investors mostly ignored an improvement in country's services sector growth with HSBC's Services Purchasing Managers Index in August inching upwards to 55.
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