The S&P BSE Sensex extended losses for the second consecutive session on Tuesday, falling by 108 points, as investors remained cautious ahead of the two-day meeting of the US central bank.
The Sensex closed at 27,253 points, down 0.40%, while the 50-share Nifty fell by 27 points, or 0.33%, to end at 8,232.
Markets were under pressure, going into the US Federal Reserve meeting on 27 and 28 October, despite less chances of an interest rate hike at the meeting.
"We expect the Federal Open Market Committee (FOMC) to hold its monetary policy unchanged as we continue to look for an initial rate hike at the March 2016 meeting," said Barclays Capital in a note.
Among the BSE sectoral indices, Consumer Durables and Capital Goods were the top losers. Auto index was the biggest gainer.
Lupin shares plunged by over 5% after the company reported a 35% drop in net profit to Rs 408 crore for the second quarter in the current financial year.
"For 2QFY2016, the company posted bad set of numbers, with OPM's coming in lower than expected, consequently net profit," said Sarabjit Kour Nangra, VP Research - Pharma, Angel Broking.
"We maintain our NEUTRAL stance on the stock," he said.
On the other hand, Maruti Suzuki stock prices closed 2.5% higher after the company's second quarter earnings came in line with the estimates.
"Going ahead, we expect Maruti to see industry beating volume growth driven by the new launches and deeper penetration. Margins have upsides from current levels considering soft commodity prices, favourable currency movement and benefits of operating leverage. For FY15-18E we expect earnings CAGR of 34% and in that light FY18E P/E of 15x appears reasonable," said Amar Ambani, Head of Research, IIFL.
Metal and oil & gas stocks came under severe selling pressure following weakness in commodity prices in the overseas markets. Global crude oil prices fell further on the back of renewed concerns on supply glut.
While shares of Oil and Natural Gas Corporation (ONGC) ended a little over 3% lower, Gas Authority of India (GAIL) stock prices were down 2.2%.
Maruti Suzuki, Reliance Capital (1.3%), Wipro (1.1%), HDFC Bank (0.9%) and Reliance Power (0.8%) were the top gainers among Sensex stocks, while ONGC, HDFC ( 2.9%), DLF (1.6%), Ambuja Cements (1.6%) and Tata Steel (1.5%) were the top losers.
On the commodity front, gold prices ended marginally higher compared to the closing prices in the previous session. The yellow metal rose Rs 40 to Rs Rs 27,110 per 10 grams, supported by a pick up in festival demand. Silver prices were also up by Rs 15 to close at Rs 37,125 per kg.