BSE Sensex is down 1.1 per cent, while the broader NSE Nifty is one per cent lower as investors book profits after a recent surge in shares.
Some analysts also express concerns as Arun Jaitley, India's new finance minister, will also oversee defence and corporate affairs although the arrangement of portfolios is meant to be temporary.
Recent outperformers fall
Oil and Natural Gas Corp falls 2.8 per cent while State Bank of India is down 2.4 per cent.
Also, foreign portfolio investors sold Indian shares worth 841 million rupees ($14.3 million) on Monday, provisional exchange data showed.
Morning trade: BSE Sensex snaps 3-day winning spree
The benchmark S&P BSE Sensex snapped its last three-day winning spree by dropping 245.58 points in the morning trade on profit-booking mainly in refinery, banking, realty and power sectors ahead of the expiry of futures and options contract on coming Thursday.
Foreign capital outflows also affected the market to some extent. Foreign institutional investors (FIIs) sold shares worth a net Rs 84.13 crore yesterday as per provisional data from the stock exchanges.
GAIL India fell by 4.40 per cent even as net profit rose 57.24 per cent to Rs 972.03 crore on 17.56 per cent rise in total income to Rs 14977.89 crore in Q4 March 2014 over Q4 March 2013.
The Sensex resumed higher at 24,748.10 and hovered in a range of 24,777.31 and 24,422.33 before quoting at 24,529.94 at 11.30 hrs, showing a loss of down 186.94 points or 0.71 per cent, from its last close.
It had gained by 418.86 points or 1.72 per cent in the last three sessions.
The NSE 50-share Nifty also dropped by 58.55 points, or 0.80 per cent, to 7,300.50 at 1100hrs.
Asian stocks edged lower in choppy trade in their early trade. Key benchmark indices in China, Singapore, Hong Kong and South Korea were off 0.02 pct to 0.87 pct while indices in and Taiwan and Japan were up 0.14 pct to 0.87 pct.