Shah, head of private client group research at Kotak Securities.
Expect market to consolidate more as optimism around reforms and rupee stability are getting matched by fiscal and inflationary problems, Shah added.
The benchmark BSE index fell 0.31 percent, or 64.03 points, to end at 20,787.30, marking its the lowest close since Dec. 19. The broader NSE index lost 0.32 percent, or 19.70 points, to end at 6,191.45, closing below the psychologically important 6,200 level.
Sentiment was also dampened after foreign institutional investors sold 6.08 billion rupees ($97.7 million) worth of index futures and 180 million rupees worth of cash shares on Friday.
Among the blue chip shares, ICICI Bank Ltd fell 2.4 percent, while Reliance Industries Ltd ended down 1.1 percent.
In state-owned large cap banks, State Bank of India fell 1.8 percent while Bank of Baroda Ltd ended 1.9 percent lower. Larsen and Toubro Ltd fell 0.2 percent, losing for a fourth consecutive session, with a total decline of 5.6 percent, on concerns that the company's new orders are slowing down, dealers say. Infosys Ltd fell 1.3 percent after making a record high at 3,580.50 rupees on profit-taking and caution ahead of its October-December results on Friday.
Power producers fell on media reports that the state government in Maharashtra, home to Mumbai, is planning to cut power tariffs.
Tata Power Co Ltd fells 2.6 percent, while Reliance Infrastructure Ltd ended lower 0.5 percent. However, among stocks that gained, Lupin Ltd gained 0.6 percent, adding to Friday's 3 percent rise on hopes of regulatory approval for its request for permission to raise its foreign investor stake.
The Foreign Investment Promotion Board is due to meet this week and dealers cite expectations the regulator could consider Lupin's proposal.
FACTORS TO WATCH
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