Financial, metal, auto and infra counters reeled under intense selling pressure as investors turned a bit cautious after the recent record-breaking rally and booked profits.
Even stronger-than-expected corporate earnings from Bank of Baroda and Hindustan Unilever failed to enthuse market though they helped the index to rebound from intra-day lows.
After a flat opening, the benchmark index turned weak in mid-morning trade and remained under intense selling pressure during most parts of the day.
Traders and retail investors, who had been buying in the past few sessions, trimmed their long positions ahead of Thursday's F&O options expiry of July series and a trading holiday tomorrow in view of Eid, a broker said.
Meanwhile, other Asian markets rallied to multi-month highs after official Chinese data showed the industrial profits of the world's second-largest economy grew at a stronger pace, easing economic slowdown fears.
The 50-share index fluctuated between a high of 7,799.90 and a low of 7,722.65 before ending at 7,748.70, a fall of 41.75 points, or 0.54 per cent. The Nifty hit a lifetime high of 7,840.95 on Friday before succumbing to selling.
Among the prominent losers were DLF, Coal India, BPCL, UltraTech, Ambuja Cement, Grasim, NMDC, Hindalco, ACC and Tata Steel. Heavyweights like Reliance Industries, ICICI Bank, TCS, HDFC and Tata Motors also witnessed heavy selling pressure.
However, FMCG major HUL topped the buying list in the Nifty after posting better-than-expected earnings in Q1. Other smart movers included HCL Tech, PNB, Cairn, Sun Pharma, BHEL, Wipro, Tata Power, Dr Reddy's and Bank of Baroda.
Turnover in the cash segment dropped to Rs 13,342.45 crore from Rs 18,437.30 crore last Friday. A total of 7,078.72 lakh shares changed hands in 61,18,913 trades, while the total market capitalisation stood at Rs 88,24,347 crore.