However, NSE Nifty managed to eke out a small gain and closed above the crucial 8,100-mark.
Sentiment remained upbeat for the major part of the session after lower inflation data raised hopes of a rate cut by RBI next month, but the index turned lower towards the fag-end as profit-booking emerged.
Sensex started off on a strong footing and advanced to a high of 26,621.40. However, it succumbed to profit-booking at higher levels, falling to 26,239.21, before settling 5.94 points or 0.02 per cent lower at 26,298.69.