"RBI's stress test results poured water on the banking sector which had been buoyant following capital infusion plans," said Anand James, Co Head Technical Research Desk, Geojit BNP Paribas.
Sentiment was also hit after Greece failed to reach an agreement with its creditors ahead of a debt deadline, equity brokers said.
However, reports that monsoon has covered the entire country, except western Rajasthan, several days before its expected date lifted market mood to some extent, they added.
"Realty and IT stocks continued to piggy back on... announcement of three flagship schemes (by the Prime Minister yesterday)," James said.
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The NSE Nifty ended 16.90 points or 0.20 per cent down at 8,381.10 after shuttling between 8,408.55 and 8,339.70 intra-day.
Both the Sensex and the Nifty indices posted their second-straight weekly gains by rising 495.67 points (1.81 pc) and 156.15 points (1.89 pc), respectively.
Reacting to the news, the BSE banking index fell by 0.74 per cent. Major losers from the Sensex were ICICI Bank, HDFC Bank and Axis Bank -- falling by up to 1.35 per cent.
Meanwhile, RBI Governor Raghuram Rajan has expressed concern that the world may be slipping into the kind of problems of the depression of the 1930s and an international consensus was needed to be built over time.