Benchmark indices Sensex and Nifty started off on a weaker note on Wednesday tracking sharp losses in Asian markets amid growing uncertainties about US-China trade deal talks.
Besides, investors seem to be taking a cautious stance ahead of Reserve Bank's monetary policy outcome, which is due on Thursday.
The 30-share BSE gauge Sensex was down 119.42 points or 0.29 per cent to 40,556.03 in early deals.
Likewise, the 50-scrip NSE Nifty fell 36.90 points or 0.31 per cent to 11,957.30 in early trade.
Exchange data showed foreign institutional investors (FIIs) sold equities worth Rs 1,131.12 crore on Tuesday.
Experts said investors are worried after US President Donald Trump said that a trade deal with China might have to wait until after the 2020 presidential polls.
On Tuesday, the BSE Sensex settled at 40,675.45, down 0.31 per cent or 126.72 points; while, the Nifty closed at 11,994.20, showing a dip of 0.45 per cent or 54 points.
Meanwhile, the Indian rupee was trading 10 paise lower at 71.76 to the US dollar in early deals.
Asian stocks were trading sharply lower as investors turned more anxious seeing no breakthrough coming soon in US-China trade deal logjam.