At 9:40 am, the Sensex traded 125.58 points - or 0.32 per cent - lower at 39,090.06 while the Nifty was down 35.95 points - or 0.31 per cent - at 11,651.55.

Yes Bank shares were the top percentage loser on both the benchmark indexes. On the BSE Sensex, the Yes Bank stock plunged as much as 14.98 per cent to Rs 83.70 apiece.

The sharp losses in Yes Bank shares came a day after the private sector lender reported a year-on-year decline of 91 per cent in net profit to Rs 113.76 crore for the quarter ended June 30.

Reliance Industries, Tata Consultancy Services (TCS) and Yes Bank weighed most on the Sensex.

On the other hand, Wipro shares rose as much as 3.25 per cent on the BSE, a day after the IT major reported a net profit of Rs. 2,387.6 crore for the quarter ended June 30, beating analysts' estimates.

On Wednesday, the domestic stock market benchmarks Sensex and Nifty had finished 0.22 per cent and 0.21 per cent higher respectively, rising for a third session in a row. Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 16.97 crore on this day, provisional data from the NSE showed.

Meanwhile, equities in other Asian markets fell amid concerns about global economic prospects and the ongoing US-China trade war. Japan's Nikkei 225 benchmark index fell 1.6 per cent, while the Shanghai Composite and Hong Kong's Hang Seng indexes dipped 0.7 per cent each.

The losses in Asia followed a negative lead from Wall Street, where big-name firms including Caterpillar and United Technology sank on weak corporate reports.