On Tuesday, none of the major political parties were able to achieve a clear majority in the Karnataka assembly elections, leading to political uncertainty.
According to market analysts, heavy selling pressure was witnessed in banking, oil and gas and automobile stocks.
Index-wise, the wider 50-scrip Nifty of the National Stock Exchange (NSE) closed at 10,741.10 points -- down 60.75 points or 0.56 per cent from the previous close of 10,801.85 points.
The barometer Sensex of the BSE, which had opened at 35,452.35 points, closed at 35,387.88 points -- lower by 156.06 points or 0.44 per cent -- from the previous day's close at 35,543.94 points.
The Sensex touched a high of 35,543.89 points and a low of 35,241.63 points during the intra-day trade.
The BSE market breadth was bearish with 1,645 declines and 993 advances.
"Broad market indices like the BSE mid-cap lost less, thereby outperforming the main indices."
Additionally, a hung assembly in Karnataka kept the mood of the markets indecisive and spurred a risk-off sentiment in the market, Dey added.
On the currency front, the Indian rupee strengthened by 72 paise against the US dollar to 67.80, from its previous close at 68.08 per greenback.
In terms of investments, provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 699.22 crore, while the domestic institutional investors bought stocks worth Rs 229.06 crore.
Scrip-wise, fraud hit Punjab National Bank's (PNB) stocks slumped around 14 per cent (intra-day) on Wednesday, a day after the bank reported a loss of over Rs 13,000 crore for the fourth quarter of 2017-18.
The stock closed at Rs 75.55 -- down Rs 10.45 or 12.15 per cent -- from the previous close of Rs 86 per share.
The major gainers on the Sensex were Hindustan Unilever, up 3.84 per cent at Rs 1,574.20; ITC, up 1.47 per cent at Rs 285.95; Wipro, up 1.44 per cent at Rs 274.30; Tata Motors (DVR), up 1.33 per cent at Rs 183.50; and Yes Bank, up 1.11 per cent at Rs 349.50 per share.
The top losers were ICICI Bank, down 3.28 per cent at Rs 297.90; Reliance Industries, down 2.34 per cent at Rs 956.45; State Bank of India, down 2.19 per cent at Rs 243.15; Hero MotoCorp, down 2.10 per cent at Rs 3,576.40; and Adani Ports, down 1.19 per cent at Rs 403.90 per share.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)