At 09:18 am, the S&P BSE Sensex was trading 29.43 points lower at 34,587.21.
The Sensex has so far touched a high of 34,500.55 points and a low of 34,396.03 points during the intra-day trade. The markets had opened flat before plunging 100 points in mid-day trade.
The top losers were: Wipro, down 3.30 per cent at Rs 287.05; Infosys, down 2.49 per cent at Rs 1,153.90; Tata Steel, down 1.23 per cent at Rs 598.25; State Bank of India, down 0.87 per cent at Rs 240.60; and Tata Consultancy Services, down 0.87 per cent at Rs 3,385.65. The Sensex was down 27 points at 34,589 while Nifty slipped to 10,603. Among sectoral sub-indices, Nifty IT gained more than a per cent.
The rupee weakened by 4 paise to 66.16 against the USA dollar in early trade due to foreign capital outflows.
In contrast, the BSE market breadth remained bearish with 1,497 declines and 1,180 advances.More news: Allison Mack Out on Bail In NXIVM Case, Under House Arrest
Financial stocks dropped today, with HDFC Bank and ICICI Bank dragging down the indexes. The yield on the 10-year Treasury note rose to 2.99 percent from 2.98 percent.
The sanctions on Rusal had driven prices of the metal to their highest since mid-2011 recently on fears that the global market could face shortages.
"Market extended gains backed by index heavyweights while correction in metals and IT were due to ease in sanctions by U.S. and tightening of H1-B visa procedure". Brent crude futures were up 0.28 percent at Dollars 74.92 a barrel and U.S. crude futures were up 0.55 percent at USD 69.02 a barrel.
In other Asian markets, Hong Kong's Hang Seng rose 1.20 percent while Japan's Nikkei was up to 0.67 percent in early trade.
Meanwhile, domestic institutional investors (DIIs) bought shares worth a net Rs 387.26 crore, while foreign portfolio investors (FPIs) sold shares worth Rs 259.08 crore yesterday, provisional data released by the stock exchanges showed.