Mumbai, June 3 : The Indian stock market closed in the red on Tuesday -- the third consecutive trading session when the domestic indices witnessed a decline amid weak global cues.

Sensex ended 636.24 points or 0.78 percent down at 80,737.51 while the Nifty was down 174.10 points or 0.70 percent at 24,542.50.

On a sectoral basis, IT, PSU Bank, Financial Services, FMCG and Energy were the biggest laggards.

Midcap and Smallcap performed better than Largecap. The Nifty Smallcap 100 index was up 18.60 points, or 0.10 per cent, at 18,114 and the Nifty Midcap 100 index was down 258.45 points, or 0.45 per cent, at 57,517.

Markets edged lower in a volatile trading session, losing over half a per cent amid weak cues.

'After an initial uptick, the Nifty oscillated sharply in early trade; however, a sharp decline below the short-term moving average (20 DEMA) in the latter half of the session kept the tone negative,' said Ajit Mishra from Religare Broking Ltd.

The ongoing foreign fund outflows, coupled with weak global cues such as geopolitical tensions and uncertainty over trade deals, are adding pressure to the markets, said analysts.

However, the relatively stronger performance in the banking space could help limit the pace of decline, they added.

It also appears that investors are awaiting a decisive commentary following the RBI's interest rate decision later this week.

Meanwhile, the Indian rupee erased Monday's gains amid risk-averse sentiments, a rebound in the US dollar, and foreign fund outflows.

In the near term, the spot USD/INR is expected to trade between 85.10 and 85.90, said Dilip Parmar from HDFC Securities.

Gold remained largely flat near Rs 97,700 after yesterday's sharp rally of nearly Rs 2,000, touching Rs 98,000 on MCX. The market is now consolidating ahead of key U.S. economic releases, said experts.

/IANS