Snapping a two-day rally, the Sensex on Wednesday fell by over 38 points, dragged down by telecom giant Bharti Airtel that slumped nearly 4 per cent, amid low participation of funds due to strike by public sector banks.

Traders said the sentiment remained lacklustre as global markets were cautious ahead of Luxembourg Prime Minister Jean-Claude Juncker, the head of the Euro Group of Finance Ministers, visiting Greece on Wednesday.

The BSE benchmark index, which had gained 229 points in the last two trading sessions, fell by 38.40 points, or 0.21 per cent to close at 17,846.86.

In the 30-share Sensex, 18 stocks declined led by the largest mobile-phone operator Bharti Airtel which dropped 3.85 per cent on reports that foreign brokerage Credit Suisse has downgraded it.

NTPC, Sterlite, Gail and RIL fell around one per cent each.

Dr. Reddy’s led Sensex gainers, followed by CIL, Infosys and Bajaj Auto.

Employees of public sector banks have gone on two-day nationwide strike today opposing banking sector reforms and outsourcing of non-core activities, affecting stock market fund flows, said analysts.

They added that a weak trend in Asian markets kept domestic markets lower from the morning and an uninspiring opening in European stocks did not help the cause.

On similar lines, the wide-based National Stock Exchange index Nifty lost 8.15 points to end at 5,412.85, after moving between 5,433.35 and 5,394.80.

More In: Markets | Business