The benchmark S&P BSE Sensex washed out initial gains, tumbling 117 points in late morning trade on Wednesday due to profit-booking from operators, triggered by heavy capital outflows from foreign funds despite firm global cues.
Shares of FMCG, refinery, banking and power sectors were the main losers.
Foreign institutional investors (FIIs) sold shares worth a net Rs 1,234.02 crore on Tuesday, as per provisional data from the stock exchanges.
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The Sensex opened higher at 20,241.12 and advanced further to a high of 20,254.82 on initial strong buying due to firm global advices.
However, it declined afterwards to 20,076.10 on fresh selling before quoting at 20,094.92 at 1030 hrs, showing a loss of 117.01 points, or 0.58 per cent, from its last close.
The NSE 50-share Nifty also moved down by 27.85 points, or 0.46 per cent, to 5,973.05 at 1030 hrs.
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Major losers were NTPC (2.00 per cent), ITC (1.57 per cent), Reliance Ind (1.33 per cent), BHEL (1.32 per cent), Tata Motors (1.27 per cent), Bharti Airtel (1.12 per cent), Hindalco (1.07 per cent) and Bajaj Auto (1.06 per cent).
Asian stocks edged higher in their early trade after U.S. shares rebounded overnight and Japanese companies posted earnings that cheered investors.
Key benchmark indices in Indonesia, Japan, Singapore and South Korea were up 0.31-0.49 per cent while indices in Hong Kong and Taiwan were off 0.22-2.68 per cent.
Stock markets in China will remain closed till February 7, 2014 for the Lunar New Year holidays.