Continued outflow of foreign funds, coupled with negative global cues and political bickering on the government's demonetisation move, subdued the Indian equity markets on Wednesday.The key equity indices closed on a flat note due to heavy selling pressure in healthcare, consumer durables and banking stocks witnessed during the second half of the session.Earlier, in the day's trade, the equity markets made gains on the back of positive global indices, coupled with higher crude oil prices and value buying in selective counters.The wider 51-scrip Nifty of the National Stock Exchange (NSE) gained only 3.15 points or 0.04 per cent to 8,111.60 points.On the other hand, the barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 26,508.94 points, closed at 26,298.69 points -- down by 5.94 points or 0.02 per cent from the previous close at 26,304.63 points.The Sensex touched a high of 26,621.40 points and a low of 26,239.21 points during the intra-day trade.The BSE market breadth was tilted in favour of the bears -- with 1,553 declines and 1,048 advances.On Tuesday, the Indian equity markets had plunged due to rupee depreciation, foreign fund outflows and an anxiety over the impact of the demonetisation move.
The barometer index had declined by 514.19 points or 1.92 per cent, while the NSE Nifty receded by 187.85 points or 2.26 per cent.Initially on Wednesday, the benchmark indices opened in the green, as investors' sentiments were buoyed on the prospects of a monetary policy easing in December due to a slowdown in retail and wholesale inflation for October.Besides, value buying and higher global crude oil prices kept the indices on a firm footing.However, global worries over trade restrictions with the US as a result of the surprise victory of Republican Donald Trump in the November 8 US Presidential election unnerved investors."The markets lost their early gains and closed on a flat note mainly due to weak global cues, as the Asian markets lost their gains and the European markets opened on a lower note," Astha Jain, Senior Research Analyst at Hem Securities, told IANS. On the domestic front, the political bickering over the government's demonetisation move and its impact on the winter session of the Parliament, too, eroded investors' confidence. According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, volatility was witnessed at the CNX Nifty due to short covering."Firm USD/INR futures prices pressurised the Indian equity markets at higher levels," Desai said."IT and banking stocks failed to sustain at higher levels in the second half of the session. Pharma, auto, oil-gas, textile and aviation stocks traded down on selling pressure, while media-entertainment, FMCG and cement stocks traded with mixed sentiments."
The Indian rupee weakened by 21 paise to 67.95 against a US dollar from its previous close of 67.74 to a greenback."The US dollar is strengthening on back of possible rate hike by the US Fed. We are expecting the dollar to consistently move northwards and touch 68.12-68.15 levels in the upcoming trading sessions," Jain added.In terms of investments, provisional data with exchanges showed that the foreign institutional investors (FIIs) sold stocks worth Rs 1,957.04 crore, and the domestic institutional investors (DIIs) purchased scrip worth Rs 2,344.31 crore.Sector-wise, the S&P BSE banking index plunged by 212.77 points, the consumer durables index declined by 217.48 points, and the healthcare index fell by 203.65 points.In contrast, the S&P BSE automobile index surged by 191.07 points, the IT index rose by 163.63 points, and the TECK (technology, media and entertainment) index edged up by 91.09 points.Major Sensex gainers during Wednesday's trade were: Asian Paints, up 5.12 per cent at Rs 937.85; Tata Consultancy Services (TCS), up 3.21 per cent at Rs 2190.25; Maruti Suzuki, up 2.91 per cent at Rs 4,983.40; HDFC, up 2.51 per cent at Rs 1,257; and Bharti Airtel, up 2.20 per cent at Rs 309.55.Major Sensex losers were: ITC, down 2.94 per cent at Rs 230.70; Dr. Reddy's Lab, down 2.89 per cent at Rs 3,212.95; Cipla, down 2.55 per cent at Rs 538.65; Lupin, down 2.27 per cent at Rs 1,407.55; and Sun Pharmaceuticals, down 2.13 per cent at Rs 667.95.