Market analyst Rajat Bose says Nifty has support at 8,127 and if 8000 levels are breached, it could slide to 7,800 levels.
Traders would also be keeping a watch on the rupee in view of dollar hitting a nine-year high against the euro. The rupee was higher at 63.34 against Tuesday's close of 63.57.
At 1:27 pm, the Sensex was down 13 points at 26,974 while Nifty was off 4 points to 8,123.
Gains in select oil & gas stocks helped support the market. Market heavyweight RIL was up 1.6 per cent after slumping 4.5 per cent in the previous session. ONGC rose 0.80 per cent after slumping over 5 per cent yesterday.
Also, buying was seen in select auto and FMCG stocks. HUL rose over 3 per cent while M&M and Maruti rose nearly 1 per cent.
Selling pressure was seen in banking stocks which had outperformed last year. The banking index, Bank Nifty, was down 0.6 per cent. PNB and ICICI Bank fell over 2.5 per cent. The other major Nifty losers included Cairn India, BHEL and GAIL, down nearly 3 per cent.
(With Agency Inputs)