Indian shares fell for a third session on Wednesday, in line with the fall in Asian shares, on increasing tensions between the U.S. and North Korea after the two countries exchanged threats.
Global risk appetite faltered resulting in investors piling onto havens such as U.S. Treasuries, gold and the yen after Pyongyang saying it is considering plans to attack U.S. island territory Guam.
The threat from the Korean peninsula came just hours after U.S. President Donald Trump said in response to a Washington Post report on North Korea's nuclear capabilities that further threats from the country would be met with "fire and fury."
The S&P BSE Sensex fell 0.86 percent to 31,738 while the broader NSE Nifty lost 0.82 percent to 9,896.
Healthcare stocks led the losses. Natco Pharma fell 11.4 percent, Aurobindo Pharma lost 6.1 percent while Sun Pharma declined 5.2 percent.
Among the financials, Axis Bank, HDFC Bank and ICICI Bank dropped between 1 percent and 2 percent.
SRF fell 6.4 percent after the company reported 33% decline in its net profit in June quarter.
Tata Chemicals dropped 3.1 percent after the company reported weaker then expected earnings.
Tata Motors lost 3.5 percent ahead of its June quarter earnings.
Market breadth was in the favour of losers, with about 2 stocks declining to every 1 stock that advanced.