The BSE Sensex was trading 114.08 points, or 0.32 per cent, lower at 35,123.60. It had dropped 226.45 points in opening trade.
The 30-share index had surged 246 points in the special Muhurat session Wednesday to mark the beginning of Hindu Samvat year 2075.
The NSE Nifty saw similar movement, and was trading 31.05 points, or 0.29 per cent, lower at 10,567.35.
The stock market was closed Thursday on account of Diwali Balipratipada.
Top losers in the morning session include Bharti Airtel, Wipro, Infosys, Tata Steel, ITC, ONGC, HDFC, NTPC and SBI, falling up to 1.65. per cent.
Meanwhile, the rupee appreciated 35 paise to 72.65 against the dollar in early trade, following US mid-tem election results and easing crude oil prices.
According to provisional data available with the BSE, foreign portfolio investors (FPIs) bought shares worth a net of Rs 31 crore Wednesday, while domestic institutional investors (DIIs) were net buyers too to the tune of Rs 27 crore.
Elsewhere in Asia, Japan's Nikkei was trading 0.93 per cent down, Shanghai Composite index fell 1.29 per cent, while Hong Kong's Hang Seng plunged 2.39 per cent and Taiwan Weighted was down 1.40 per cent in their early sessions.
On Wall Street, the S&P 500 lost 0.25 per cent and the Nasdaq shed 0.53 per cent after the Fed's statement.