Mumbai: Markets turned weak in a choppy trade on Tuesday as cautious investors kept their powder dry ahead of the Reserve Bank of India’s (RBI) policy announcement amid subdued macro cues. The Reserve Bank’s two-day monetary policy review kicked off on Tuesday. The central bank is widely expected to keep policy rates unchanged tomorrow and will stay focused on controlling inflation, experts said.
The 30-share Sensex opened on a negative note on across- the-board losses and touched a low of 32,682.52. However, value-buying in several heavyweights towards the fag-end trimmed the losses, with the index finishing at 32,802.44, down 67.28 points, or 0.20%. The broader NSE Nifty too slipped by 9.50 points, or 0.09%, to end at 10,118.25, after moving between 10,069.10 and 10,147.95.
Trading mood was also impacted as Fitch Ratings on Monday cut the country’s gross domestic product growth forecast for the current fiscal to 6.7% from the earlier projected 6.9%. Services sector activity slipped into the contraction territory during November, post the implementation of the goods and service tax that led to sluggish demand and lower customer turnout, a monthly survey said.
“The recent correction in PSU banks provides an opportunity for investors to accumulate as the long term prospects remains strong owing to healthy recapitalisation. On the macro front upcoming RBI policy and Gujarat state election will be an influential factor for investors which is steering the market to consolidate,” said Vinod Nair, head of research, Geojit Financial Services.
Meanwhile, foreign portfolio investors offloaded shares worth net Rs333.59 crore, while domestic institutional investors bought shares to the tune of Rs776.18 crore on Monday, as per provisional data.
Hero MotoCorp was the worst performer in the Sensex pack, falling 2.31%, followed by Wipro at 2.29%. Other losers included Tata Steel, NTPC, Dr Reddy’s, ONGC, Power Grid, Bajaj Auto, L&T, M&M, Asian Paints, HDFC Bank, HUL, Lupin, Coal India, ITC, Tata Motors, Axis Bank, Maruti Suzuki and Infosys, falling by up to 1.71%. Bucking the trend, SBI topped the gainers list by rising 1.92%, while Bharti Airtel gained 1.18%.
Among the BSE sectoral indices, power fell 1.06%, followed by metal 0.85%, capital goods 0.62%, consumer durables 0.61%, infra 0.56%, auto 0.52% and IT 0.38%. The broader market depicted a mixed trend, with the BSE mid-cap ending up 0.41%, while small-cap index finished 0.03% down.
Asian markets retreated, with Japan’s Nikkei falling 0.37%, Hong Kong’s Hang Seng declining 1.01% and Shanghai Composite Index finishing 0.18% lower. European markets too saw a weak trend. Paris CAC fell 0.29% and Frankfurt’s DAX shed 0.13%. London’s FTSE rose 0.16% in late morning deals.