Equity markets halted their two-day rally in early trade on Friday, with the Sensex falling nearly 667 points, reflecting weak global markets, and selling in major indices HDFC Bank and TCS.
Persistent foreign fund outflows also weighed on the sentiment.
The BSE benchmark Sensex was trading 666.85 points lower at 57,244.83. Nifty also closed 196.55 points lower at 17,196.05.
Mahindra & Mahindra, Dr Reddy’s, Nestle, Kotak Mahindra Bank, UltraTech Cement, State Bank of India and Maruti Suzuki were the biggest losers in the 30-share Sensex pack. Conversely, HCL Technologies, Bharti Airtel, Power Grid and Tata Steel were among the gainers.
On Thursday, the Sensex closed at 57,911.68, up 874.18 points or 1.53%. Nifty closed 256.05 points or 1.49% higher at 17,392.60.
Elsewhere in Asia, markets in Tokyo, Hong Kong, Shanghai and Seoul were trading lower in mid-session deals.
Shares in the US closed with a fall on Thursday.
Meanwhile, international oil benchmark Brent crude fell 1% to $107.25 a barrel.
Foreign institutional investors continued selling shares worth Rs 713.69 crore on Thursday, according to stock exchange data.