Sensex, which had gained 420.84 points in previous two trading sessions, fell by 101.33 points, or 0.48 per cent to 21,032.88.
The Sensex fell for the first time in three days on Tuesday and closed over 101 points lower after investors booked profits in recent gainers including IT, metal and realty shares, amid a weak trend in the global markets.
The 30-share index, which had gained 420.84 points in previous two trading sessions, fell by 101.33 points, or 0.48 per cent to 21,032.88. TCS, ICICI Bank and Tata Motors led the 22 Sensex losers, while Infosys, HDFC and Cipla led 8 gainers.
The 50-share National Stock Exchange index Nifty declined by 30.90 points, or 0.49 per cent, to end at 6,241.85.
Brokers said besides profit-booking after recent gains, a weak trend in the Asian region and a lower opening in Europe following overnight losses in the US market, too triggered selling activity.
Meanwhile, retail inflation slowed to three-month low of 9.87 per cent in December, supporting hopes the RBI will keep interest rates stable in its policy meet later this month.
Overall market breadth was weak with 1,464 stocks declining compared to 1,226 that advanced on the BSE.
Stocks of Ranbaxy Laboratories remained under selling pressure and fell by nearly 2 per cent after the USFDA raised concerns about manufacturing practices at the pharmaceutical firm’s plant in Punjab. In the previous session, the stock plunged over 5 per cent.
Among software exporters, Tata Consultancy Services fell 1.78 per cent, HCL Technologies by 1.65 per cent and Wipro shed 1.56 per cent. However, Infosys continued its rising streak to close 0.63 per cent higher.
The IT sector index, which had been leading the rise in the last few sessions, ended in negative territory with a decline of 0.67 per cent.
Sectorally, the BSE Metal index suffered the most by falling 1.41 per cent, followed by Realty index that dipped 1.40 per cent and Banking index slid 0.66 per cent.