"There was some short covering towards the end. But a lot of stock futures are still in an unwinding position, indicating no one is ready to take a risk and carry home positions," said a derivatives dealer.
The Nifty ended at 4449.80, down 51.15 points, or 1.1 per cent. It moved between 4369.80 and 4522.55 during the day.
The June contract ended at 4453.00, down 13.60 points, the July contract ended at 4445.00, down 16.25 points, and the August contract ended at 4437.00, down 33.95 points.
Dealers said the markets might bounce back on bouts of short covering in coming sessions. But buying interest at lower levels remains subdued amid uncertainty about direction. The Nifty faces a resistance at 4555. The investors preferred pharma and metal shares, including Steel Authority of India and Tata Steel, on Tuesday.
The likelihood of monetary tightening measures kept shares of interest rate-sensitive sectors such as bank and real estate down.
Reliance Industries, Reliance Petroleum and Ranbaxy were among the most actively traded June contracts.
The turnover in NSE's derivatives segment was Rs 538.9 billion, compared with Rs 583.3 billion on Monday. The cumulative foreign institutional investor position, as a percentage of total gross market position was 40.57 per cent, compared with 40.17 per cent in the previous session.
