Besides, the rupee taking a sharp plunge of 32 paise to 68.14 against the dollar in early trade also dampened the market sentiments.
The 30-share index was down 49.21 points, or 0.18 per cent, at 26,178.41, with stocks of consumer durables, metal, FMCG, realty, capital goods and healthcare leading the fall.
The gauge had plunged by 1,290.06 points in the previous four sessions.
The NSE benchmark Nifty fell 19.65 points, or 0.24 per cent, to trade at 8,060.30.
Sentiments took a hit after the US Federal Reserve chief indicated the US may hike interest rates next month, leading to acceleration in capital outflows by foreign funds, traders said.
Moreover, prevailing cash crunch following the government’s demonetisation decision has severely impacted select sectors like real estate, consumer goods and metal.
Besides, a mixed trend on other Asian bourses also influenced the trading momentum.
Shanghai Composite Index shed 0.16 per cent while Japan’s Nikkei was up 0.84 per cent in morning trade today. Hong Kong’s Hang Seng rose 0.20 per cent.
The US Dow Jones Industrial Average ended 0.19 per cent higher in yesterday’s trade.
PTI