In volatile trade,the benchmark BSE Sensex broke a three-day upmove and closed 43.09 points down today on emergence of profit-booking and weak global cues,amid renewed fears of US Fed tapering its economic stimulus.
Sectors including FMCG,consumer durables and banking saw selling while realty,oil and metal scrips witnessed buying.
The BSE Sensex,which had gained 477.75 points in the previous three sessions and touched a one-month high,resumed lower reacting to tepid global markets. Later,it hit a high of 20,927.05 but could not sustain gains. The index finally closed down 43.09 points,or 0.21 per cent,at 20,854.92.
Losses in ITC Ltd,Larsen & Toubro (L&T) and HDFC Bank shares dragged the 30-share barometer lower. Dr Reddy’s Laboratories and Sesa Sterlite were the biggest laggards. On the other hand,gains in RIL,GAIL and Infosys shares cushioned the drop.
Brokers said profit-booking was triggered by a weakening trend in global markets nature following three days of gains.
The 50-share NSE Nifty index fell by 16 points,or 0.26 per cent to end at 6,201.85. Also,SX40 index of MCX Stock Exchange ended almost flat at 12,371.94,down 3.82 points.
“Nifty oscillated throughout the day within a mere range of 20 points as it nears the upper end of the broad range. The broad trading range continues to be 6250-5950. Hence,the existing up move may extend by another 50-60 odd points,” said Shubham Agarwal,Associate VP & Senior Technical Equities Analyst,Motilal Oswal Securities.
Analysts said the Asian markets ended weak followed by a lower opening in Europe as investors awaited US jobs data.
Recent economic growth signals have sparked off fresh fears of the US Federal Reserve tapering its USD 85 billion monthly bond buys,they added.
Overall,seven of the 13 BSE sectoral indices closed in the red. The FMCG sector index suffered the most by losing 0.83 per cent,follwed by consumer durables (0.58 per cent),banking index (0.56 per cent) and auto index (0.43 per cent).
* BSE index falls 0.21 pct; NSE ends 0.26 pct lower
* RBI proposes new capital rules for too-big-to-fail Indian banks
* Eicher surges to all-time high on overseas buying-dealers
Indian shares snap 3-day winning streak
(Reuters) Indian shares fell on Tuesday to snap a three-day winning streak as stocks of blue chips such as Larsen and Toubro fell due to profit-taking after upbeat U.S. economic data raised fears the Federal Reserve would reduce its monetary stimulus.
Even a sharp improvement in the current account deficit in the July-September quarter and the Indian finance minister’s comment that recovery was underway,failed to sustain the momentum that had sent shares to near a month-high on Monday.
Traders say caution is likely to prevail ahead of the state election results to be announced on Sunday and U.S. monthly employment data,due out on Friday,which could help provide additional clues about potential Fed tapering. “Taper is at least 2 months away and the election outcome is coming in just a few days. I think election results would decide the fate of year-end money which is currently waiting to be deployed,” said Deven Choksey,managing director at K R Choksey Securities.
The benchmark BSE index fell 0.21 percent,or 43.09 points,to end at 20,854.92,retracing from nearly a month-high level hit on Monday.
The broader NSE index lost 0.26 percent,or 16 points,to end at 6,201.85.
The falls also tracked Asian shares lower after the Institute for Supply Management said its index of U.S. factory activity rose in November to its best showing since April 2011,while the pace of hiring in the sector also accelerated. In addition,construction spending increased 0.8 percent in October,the highest since May 2009.
Among domestic blue chip shares,Larsen and Toubro Ltd (L&T) fell 1.4 percent while HDFC Bank Ltd ended 0.8 percent lower.
Lenders Kotak Mahindra Bank Ltd fell 1.5 percent while ICICI Bank Ltd ended 0.3 percent lower.
The lenders were also weighed down by the Indian central bank’s plans to introduce increased capital requirements by 2016 for banks regarded as too big to fail,and make them subject to greater regulatory oversight.
Bajaj Auto Ltd dropped 0.4 percent after the company said its November auto sales fell 17 percent to 310,591 units.
Rival Eicher Motors Ltd ended 2.8 percent higher after earlier marking an all-time high of 5,340 rupees,on speculation of increased buying from overseas investors,dealers said.
FACTORS TO WATCH
* EURO RISES TO FRESH 5-YEAR HIGH OF 140.03 YEN
* Brent crude oil rises towards $112,near 11-week high
* Asian shares hit by Fed taper anxiety
* Foreign institutional investor flows