Infosys was the top gainer in the Sensex pack, rising 2.36 per cent, followed by HDFC Bank up 1.39 per cent.
Equity benchmarks erased early gains after realty, capital goods, teck, auto, PSU, IT, power and bankex counters came under selling pressure, falling up to 1.28 per cent.
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Government has forecast annual economic growth to rise to 7.4%.
Covering-up of short positions ahead of Thursday's expiry of August series in the derivatives segment gave equities a slight push
Among the gainers, Sun Pharma topped by rising 3.03 per cent as the weak rupee tempted buyers to accumulate shares of pharma exporters.
Pharma shares were the top gainers led by Lupin after the company received EIR from USFDA for its Goa facility
Most of the session's gains for both the indices were wiped out as investors rushed to book profits ahead of F&O expiry on Thursday and also due to concerns over stretched valuations.
The session was marked by volatility and stock-specific action, even as the overall sentiment remains risk-averse, brokers said.
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Investors booked profits in recent gainers
The New Year 2015, however, may see shares worth over Rs 50,000 crore (Rs 500 billion) being put on the table by the government, including by way of part-sale of its holdings in PSUs and its residual minority stakes in some private sector entities.
Small- and mid-cap stocks continued facing selling pressure due to stretched valuations.
Investor sentiments remained upbeat tracking global developments as the US, China geared up for trade talks due this week.
Markets end in red; bluechips struggle to keep pace.
The sentiment-driven rally also got support from stock specific earning results and Finance Minister Arun Jaitley's statement that the Centre will step up reforms to attract more investment and fill up infrastructure deficit.
Sun Pharma was the biggest gainer in the Sensex pack, advancing 1.79 per cent.
The broader Nifty of National Stock Exchange scaled the 10,200 mark intra day before closing at 10,184.85, showing a sizeable gain of 38.30 points, or 0.38 per cent.
Tata Steel was the day's worst performer in the Sensex pack, plunging 3.25 per cent, followed by Bharti Airtel at 3.05 per cent.
The NSE Nifty, which dipped below the key 10,800-mark to touch a low of 10,755.40, bounced back on late buying to close at 10,817.70, up 9.65 points, or 0.09 per cent.
The BSE gauge Sensex fell 73.88 points to 35,548.26 and the NSE Nifty slid 17.85 points to 10,799.85, taking cues from tumbling global shares.
Financials were the top gainers lead by private lenders ICICI Bank and HDFC Bank
The S&P BSE Sensex ended down 371 points at 24,966 and the Nifty50 closed 101 points lower at 7,615.
Coal India topped the losers' list in the Sensex pack on Tuesday, falling 2.36 per cent, followed by Bharti Airtel at 2.16 per cent.
Investors lost around Rs 1.57 lakh crore in market valuation on Friday.
FII stance, progress of monsoon, crude oil and rupee movement are likely to dictate the trend.
Sensex sinks into red at close on growth concerns.
SBI leads a 17-member consortium of lenders that is trying to recover dues running into over Rs 7,500 crore (Rs 75 billion) in principal alone from Kingfisher Airlines.
The trend was visible in the early trade on Thursday as investors indulged in trimming their bets after the minutes of the US Federal Reserve's September meeting indicated a possible rate hike this year.
The BSE benchmark Sensex surged about 241 points to end at 35,165.48 and the NSE Nifty gained 84 points to close at 10,688.65.
The market sentiment was also impacted by mixed global cues as setbacks for a healthcare overhaul in the US raised doubts over prospects for a range of reforms backed by President Donald Trump.
Sensex, Nifty end the day in red ahaead of F&O expiry.
The reason is believed to be a 19% increase in interest cost.
Muted global trend after a report that US President Donald Trump was preparing to impose more tariffs on China hurt trading sentiments.
Investors booked profits in range-bound trade, led by PSU, oil & gas, energy, infrastructure, telecom, realty, healthcare, bankex, FMCG, capital goods and power counters.
Muted quarterly earnings, mixed cues from global markets and unabated foreign fund outflows added to the volatility
Traders said falling crude prices in the global market was a big boost for the economy as it lightens the country's import bill burden, eases inflation and current account deficit concerns.
The 50-stock NSE barometer Nifty finished 22.50 points, or 0.21 per cent, down at 10,526.20
The Sensex and Nifty remained above their key levels of 36,000 and 10,900 throughout the session, indicating strong investor optimism after a prolonged spell of caution.
Sentiment was largely positive after April IIP grew at 4.9 per cent, spurred by higher growth in manufacturing and mining sectors.