The key benchmark indices pared losses in the afternoon trades today. The Sensex was down 74 points at 16,208. The Nifty dropped 20 points to trade at 4,805.
While realty, metal and auto stocks declined, some buying interest was seen in defensive counters like FMCG and pharma.
Among the Sensex stocks, DLF and RCom fell over 4 per cent each. BHEL, Tata Motors, JP Associates and Hindalco dropped over 2 per cent each.
Sun Pharma and ONGC rose more than 2 per cent each. HUL was up 1.9 per cent.
Asian stock markets fell for a third day on Thursday after a Wall Street sell-off on signs of weakness in the US housing market triggered fears about the health of the global recovery.
Tokyo, Hong Kong, Shanghai and Seoul all lost about 2 per cent or more after a US government report showed new home sales fell unexpectedly in September for the first time since March. That fueled fears the housing rebound was driven solely by government policies that are being withdrawn before the private sector recovers.