Benchmark Nifty shed 10 points to end at 11,346.20 today, pulled down by auto and banking stocks, after the RBI raised repo rate by 25 basis points to a two-year high of 6.5 per cent.
A private survey showing factory growth easing in July and conflicting signs over the US-China trade relations also weighed on sentiment.
Meanwhile, foreign portfolio investors (FPIs) bought shares worth a net of Rs 572.21 crore, while domestic institutional investors (DIIs) sold equities to the tune of Rs 290.87 crore yesterday, provisional data showed.
Overseas, European stocks were trading lower as investors sifted through the latest news on the US-China trade front. Most Asian stocks ended higher.
The Nifty 50 index eased 10.30 points or 0.09 percent to end at 11,346.20 after hovering between 11,390.55 and 11,313.55. It witnessed an intra-day movement of about 77 pts.
Sector-wise, Auto fell 0.70 per cent, followed by Private Bank 0.67 per cent, Finance Service 0.62 per cent, Bank 0.60 per cent, Metal 0.45 per cent and Infra 0.26 per cent.
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Pharma rose by 1.33 per cent, IT 0.63 per cent, Energy 0.63 per cent, Media 0.60 per cent, FMCG 0.54 per cent, PSU bank 0.52 per cent and Realty 0.18 per cent.
Major index gainers were Coal India, Lupin, Bharti Infratel, Dr Reddy's, IOC, BPCL, HPCL, TCS and Power Grid.
Index losers included Hindalco, Maruti, Vedanta, Eicher Motors, ICICI Bank, Tata Steel, HDFC and Axis Bank.
The market breadth, indicating the overall health of the market, was in favour of gainers. On NSE, 949 shares advanced and 820 declined, while 117 remained unchanged.
Total securities that hit their price bands were 244.
Turnover in the cash segment fell to Rs 33,806.18 crore from Rs 34,992.24 crores as on Tuesday.
A total of 16,142.82 lakh shares changed hands in 1,20,71,738 trades. The market capitalisation of listed firms on the NSE stood at Rs 1,51,65,026.12 crore.