Equities failed to maintain the initial buoyancy and shed ground for the second straight day on renewed profit selling in key heavyweights as the benchmark Nifty ended lower by 11 points amid depressing Asian market sentiments.
Market mood turned decidedly more bitter after rating agency Moody's lowered India's growth forecast to 7 per cent for from 7.5 per cent projected earlier impacted by deficit monsoon and reforms slowdown.
Worries over deficient rains which has widened to 10 per cent, too weighed on trade.
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After the initial strong showing, bourses turned highly volatile as investors rushed to book profits following a sudden sell-off in Chinese stocks despite recent government measures to restore confidence.
The market had appeared to regain its footing in late afternoon trade on the back of heavy short-covering as well as good low level support and traded in green briefly before slipping back into red.
Elsewhere in the region, a massive sell-off in Chinese equities, which plunged over 6 per cent, once again sent emerging markets into a tailspin with all key indices ending in deep red.
The broader 50-share Nifty opened firmly higher at 8,505.85 and swung between a high of 8,525.75 and a low of 8,433.60 before settling at 8,466.55, a fall of 10.75 points, or 0.13 per cent over its last close.
Metal was the top sectoral loser followed by pharma, energy, financials, media and realty, while technology and auto withstood the fall.
Among second line shares, small caps fared better, rallying by 1.14 per cent, while midcap gained 0.51 per cent.
Major losers included HDFC, Tata Motors, Sun Pharma, Kotak Mahindra, Reliance, ITC, Lupin, ICICI Bank, HDFC Bank, Cipla, Coal India, Idea, Gail, ONGC, Bharti Artel and Wipro.
Prominent gainers were Infosys, TCS, SBI, L&T, Maruti, BPCL, Indusind Bank, TechM, M&M, Tata Steel, ACC and Grasim.
Turnover in the cash segment jumped to Rs 17,014.90 crore compared to Rs 16,112.86 crore yesterday.
A total of 8,274.27 lakh shares changed hands in 79,14,945 trades and the total market capitalisation of NSE stood at Rs 1,01,48,818 crore.
