Besides, caution ahead of the Reserve Bank of India's Monetary Policy Committee (MPC) meet, coupled with negative global cues and heavy selling pressure in consumer durables, automobile and capital goods stocks, eroded investors' risk-taking appetite.

The wider 51-scrip Nifty of the National Stock Exchange (NSE) opened above the 9,700 mark for the first time at 9,704.25 points and touched a new intra-day high of 9,709.30 points.

However, around 12.45 p.m., it traded lower by 25.35 points or 0.26 per cent at 9,649.75 points.

The 30-scrip Sensitive Index (Sensex) of the BSE, which opened at 31,420.85 points, traded at 31,216.92 points (at 12.45 p.m.) -- down 92.57 points or 0.30 per cent from its previous close at 31,309.49 points.

It touched a fresh high of 31,430.32 points intra-day.

The BSE market breadth was bearish -- with 1,641 declines and 829 advances.

"Nifty managed to make fresh high and traded above 9,700 for the first time in the morning. After making a new high, Nifty gave up some of its gains on profit booking and is now trading in a narrow range," Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

"Sectors which are leading the market are IT, metal and oil and gas, while sectors which are lagging are FMCG, consumer goods and auto. Asian stocks, too, traded in red."

On Monday, the benchmark indices closed flat and yet were lifted marginally to a new high -- both intra-day and at the end of the day.

The Nifty closed at 9,675.10 points, touching a record intra-day high of 9,687.20 points. The Sensex closed at a fresh high of 31,309.49 points, after touching a new intra-day high of 31,355.42 points.