Sentiment continued to remain bearish on concerns over muted Q4 earnings, delay in key reform bills in Parliament and forecast of a subdued monsoon, brokers said.
German and US bonds yields soaring to their highest in over five months too impacted sentiments here, they added.
A government data today showed Wholesale Price Index (WPI) inflation declined to a new low of (-) 2.65 per cent in April.
However, gains in Hindalco, SBI, Bajaj Auto and Tata Steel stocks trimmed most of losses and the index settled with a fall of 45.04 points or 0.17 per cent at 27,206.06.
The NSE Nifty also edged lower by 11.25 points or 0.14 per cent to end at 8,224.20. Intra-day, it cracked the 8200-mark to touch a low of 8,137.30.
Stocks of Vedanta suffered the most among Sensex constituents by falling 1.65 per cent.
Losses in Sun Pharma, HDFC, ITC, ICICI Bank, RIL, L&T, Tata Motors and Axis Bank too weighed down on the index.
Of 30-Sensex stocks, 12 stocks ended lower, while 18 finished in positive zone.
However, broader market managed to fare better. "The mid-cap and small-cap indexes outperforming the broader markets closed up around 0.89 and 0.92 per cent, respectively," said Alex Mathews, Head Research at Geojit BNP Paribas Financial Services.
Sectorally, the BSE IT index fell the most by losing 0.71 per cent as Infosys, TCS and Wipro plunged by up to 1.09 per cent on strengthening of the rupee against US dollar.