Benchmark indices Sensex and Nifty closed lower on Monday as investors turned cautious ahead of the US Fed interest rate decision amid weak global cues.
Besides, selling pressure in metal and IT counters amid a weak rupee and sluggish Chinese economic data hit investors' sentiment, traders said.
The 30-share BSE benchmark Sensex declined 384.55 points or 0.47 per cent to settle at 81,748.57.
During the day, it dropped 581.84 points or 0.70 per cent to 81,551.28.
The NSE Nifty lost 100.05 points or 0.40 per cent to 24,668.25.
"Domestic equities took cues from Asian and European indices and ended negative, as investors await the outcome of the US FOMC meeting on rate decision later this week.
"Although a rate cut is on the cards, there is a lack of confidence amongst the investors due to the sluggish Chinese economy and concerns ahead of Trump's decision on import tariffs on key economies," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.
There is heightened action in the primary markets, with five IPO listings and seven new IPOs opening for subscription in this week, he added.
From the 30-share Sensex blue-chip pack, Titan, Adani Ports, UltraTech Cement, Tata Consultancy Services, NTPC, Bharti Airtel, Tech Mahindra, Infosys, Hindustan Unilever and JSW Steel were the biggest laggards.
The BSE midcap gauge jumped 0.73 per cent, and smallcap index climbed 0.47 per cent.
"The national market traded in a range-bound manner while the realty sector outperformed in expectation of growing demand and a potential rate cut cycle in 2025.
"Rising US 10-year bond yields and a strengthening dollar led investors to remain watchful of the upcoming US Fed policy and its commentary for 2025 rates," Vinod Nair, Head of Research, Geojit Financial Services, said.
Among sectoral indices, metal dropped by 0.95 per cent, teck fell by 0.82 per cent, oil & gas (0.75 per cent), BSE Focused IT (0.74 per cent) and utilities (0.63 per cent).
Realty surged 3.17 per cent, consumer discretionary (0.69 per cent), consumer durables (0.50 per cent), capital goods (0.38 per cent) and healthcare (0.22 per cent) were the gainers.
"...the Nifty Metal index dropped...pressured by weak global prices and concerns over US-China trade dynamics. Weaker-than-expected retail sales data from China, a key consumer of metals, added to fears of slowing demand.
"Nifty IT snapped its five-day winning streak, shedding 0.9 per cent on account of profit booking. Nifty Realty gained more than 3 per cent, buoyed by new property launches and optimism surrounding strong housing demand in 2025," Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services Ltd.
In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong settled lower.
Foreign Institutional Investors (FIIs) bought equities worth Rs 2,335.32 crore on Friday, according to exchange data.
Global oil benchmark Brent crude declined 0.75 per cent to $73.91 a barrel.
"There is heightened action in the primary markets with five IPO listings and seven new IPOs opening for subscription this week.
"We expect markets to consolidate within a broad range, as sentiments remain cautious ahead of US Fed and Bank of Japan's interest rate decision this week," Khemka said.
