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Indian blue-chip shares fell on Monday, weighed down by the heavyweight information technology (IT) and financial stocks after gains in the special "muhurat" session and ahead of retail inflation data for October.

The NSE Nifty 50 index settled 0.42% lower at 19,443.55, while the S&P BSE Sensex fell 0.50% to 64,933.87.

That was after they rose about 0.5% each to three-week highs in the special one-hour "muhurat" trading session on Sunday.

"The fall ... is a case of technical pull-back after the rise in the special trading session on Sunday," said Aishvarya Dadheech, chief investment officer at Fident Asset Management.

The outlook for domestic markets remains positive due to stable earnings and strong macroeconomic fundamentals, said Dadheech.

Goldman Sachs upgraded Indian shares to "overweight", citing strong growth prospects and sustained earnings momentum.

India's retail inflation is expected to have dropped to a four-month low of 4.80% in October, a Reuters poll found. The data for October is due at 5:30 p.m. IST.

IT and financials lost 0.73% and 0.59%, respectively. They gained 0.72% and 0.44%, respectively, in the "muhurat" session.

SBI Life Insurance fell 2.26% and Bajaj Finance slid 1.25% to become the top losers on the Nifty 50.

The more domestically focussed mid-caps eked out a 0.07% gain, while the small-caps jumped 0.68%, aided by sustained retail inflows.

Among individual stocks, Coal India rose 5.29% after topping quarterly profit estimates on higher power demand.

Eicher Motors jumped 1.85% after a record second-quarter profit due to strong Royal Enfield motorcycle sales.

Indian markets will remain closed on Tuesday for a local holiday.