The 30-share index ended the day at 27,710, down 205.37 points, while broad-based 50-share index quoted 8,510, down 55.75 points at close.
Axis Bank was the top loser on both the benchmark indices and fell 4 per cent on the bourses.
Kotak Mahindra Bank, ITC, Hindalco Industries and Cairn India are expected to report their quarterly results on Thursday.
HDFC Bank, India's second-biggest private sector lender by assets, reported a 20 per cent rise in quarterly profit, in line with analysts' estimates.
Investors are also waiting to see whether the government can pass a revamped goods and services tax bill in the ongoing parliament session.
But overall, analysts said markets would likely retain their positive tone, with the NSE index up 3.4 per cent this month as of Wednesday's close, its fifth consecutive monthly gain.
"Last couple of days we've been going below 8,500 and managing to close above 8,500. So that's a positive takeaway for markets," said Gaurang Shah, vice president at Geojit BNP Paribas Financial Services, referring to the Nifty.
Larsen & Toubro Infotech settled the day at Rs 697.65, down 4.66 per cent from its IPO price of Rs 710, as its debut was marred by concerns about the outlook for the software services exports sector after some disappointing earnings this month.
Among gainers, Ambuja Cements rose as much as 2.18 per cent to its highest in more than a year after the company received government nod to buy 24 per cent of its holding company Holcim (India) Pvt, paving way for restructuring of Ambuja parent LafargeHolcim's India assets.
LafargeHolcim's majority-owned ACC rose as much as 5.3 per cent and was among the top per centage gainers on the Nifty.
(With inputs from Reuters)