The Sensex, which, scaled to a new lifetime intra-day high of 9994, tumbled into negative zone to touch a low of 9819, and finally closing with a loss of 61 points at 9,859.
The Nifty lost 27 points to close at 2,974.
Larsen & Toubro was the major gainer of the day, the stock rallied to a new peak of Rs 2,382, before settling with a gain of 5.6% at Rs 2,288.
Dr.Reddy's, too, rallied smartly to a high of Rs 1,209, and finally closed with a gain of 5.2% at Rs 1,178.
HDFC advanced 3.3% to Rs 1,385, and Grasim moved up 2.8% to Rs 1,492.
Hero Honda and NTPC ended with gains of 1% each at Rs 865 and Rs 116, respectively.
Ranbaxy dropped 3.7% to Rs 384.
Reliance Energy shed 3.8% to Rs 612, and Reliance slipped 1% to Rs 706.
Gujarat Ambuja was down 3.5% to Rs 85.45. The stock has slumped 12.3% following the Holcim takeover deal in the last three trading days.
ICICI Bank and HDFC Bank declined over 3% each to Rs 590 and Rs 737, respectively. SBI closed with a loss of 2% at Rs 870.
Hindalco dropped 2% to Rs 161, and Tata Steel was down 1.6% at Rs 398.
Maruti and HLL slipped 2% each to Rs 741 and Rs 191, respectively.
Satyam was down nearly 2% at Rs 733, and Wipro lost 1.6% at Rs 522.
Bharti, ONGC and Tata Power also declined over 1% each today.