Benchmark indices settled lower on Friday, with the Sensex declining 111 points on the back of a sharp fall in index heavyweight Reliance Industries.
The BSE benchmark went lower by 111.01 points or 0.21 per cent to settle at 52,907.93. During the day, it tanked 924.69 points or 1.74 per cent to 52,094.25.
The NSE Nifty dipped 28.20 points or 0.18 per cent to close at 15,752.05.
The government on Friday slapped an export tax on petrol, diesel and jet fuel (ATF) while also joining nations like the UK in imposing a windfall tax on crude oil produced locally.
Among the Sensex pack, Reliance Industries tumbled 7.25 per cent.
PowerGrid, NTPC, Bharti Airtel, Maruti, Dr Reddy's Laboratories and ICICI Bank were the other major laggards.
On the other hand, ITC, Bajaj Finance, Bajaj Finserv, Hindustan Unilever, Asian Paints, TCS and HDFC were among the major gainers.
"Unfavourable cues from the domestic market led to a weak start due to weakness in the rupee and selling in oil refineries as the government imposed an additional export duty on petrol and diesel.
"Adding to the weakness, India's factory output growth slowed down during June, as high inflation continued to dampen demand," said Vinod Nair, Head of Research at Geojit Financial Services.
Elsewhere in Asia, markets in Tokyo, Seoul and Shanghai ended lower.
European bourses were trading in the green in mid-session deals. The US markets ended lower on Thursday.
India's manufacturing sector activity eased to a nine-month low in June as growth of total sales and production moderated amid intense price pressures, a monthly survey said on Friday.
Meanwhile, international oil benchmark Brent crude jumped 1.90 per cent to USD 111.1 per barrel.
Foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 1,138.05 crore on Thursday, as per exchange data.