Sharp rally in crude oil prices, contraction in domestic factory data and likely delay in GST implementation also drove the market lower.
Globally, investors maintained cautious stance ahead of two-day Federal Reserve meeting that will begin tomorrow.
Overseas, European stocks edged lower as investors await another rate decision from the US Federal Reserve later this week. Asian stocks witnessed a mixed trend.
US markets continued their recent winning streak, closing at all-time highs on Friday.
The Nifty opened higher at 8,230.65, but later drifted to 8,154.45 before finishing at 8,170.80, showing a fall of 90.95 points or 1.10 per cent.
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On sectoral front, Auto fell by 1.73 per cent, followed by Private Bank (1.70 per cent), Bank (1.62 per cent), PSU Bank (1.54 per cent), FMCG (1.47 per cent), Media (1.41 per cent), Financial Service (1.29 per cent) and Energy (0.51 per cent).
Major index laggards were Ambuja Cement (3.56 per cent), BPCL (3.59 per cent), Asian Paints (3.34 per cent), Ultratech Cement (2.99 per cent), Eicher Motors (2.91 per cent), IndusInd Bank (2.59 per cent) and Axis Bank (2.54 per cent).
The gainers list includes ONGC (1.52 per cent), NTPC (0.85 per cent), TCS (0.59 per cent), Sun Pharma (0.51 per cent) and L&T (0.20 per cent).
Turnover in the cash segment fell to 13,324.58 crore from Rs 16,860.77 as on last Friday.
A total of 7,084.50 lakh shares changed hands in 6,708,322 trades. The market capitalisation of NSE stood at Rs 10,545,352.83 crore.