Mumbai, Feb 25 (IANS) Disappointment over the railway budget, coupled with negative Asian indices and derivatives expiry subdued Indian equity markets during the mid-afternoon trade session on Thursday.
This led the barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) to trade flat — down by 54 points, or 0.23 percent.
Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) traded lower by 33.20 points, or 0.47 percent, at 6,985.50 points.
The Sensex, which opened at 23,105.16 points, traded at 23,035.28 points (1.35 p.m.) — down 53.65 points, or 0.23 percent from the previous day’s close at 23,088.93 points.
During the intra-day trade, the Sensex touched a high of 23,142.96 points and a low of 22,961.05 points.
The BSE market breadth was heavily tilted towards the bears — with 1,391 declines and 880 advances.
Initially, the key indices of the Indian equity markets opened on a negative note in sync with their Asian peers.
Investors’ sentiments were subdued after the railway budget failed to announce big ticket capital expenditure projects, so as to meet the government’s fiscal deficit targets.
However, the markets rose briefly on the back of strengthening rupee and short-covering value-buying which were triggered by budgetary expectations.
The rupee opened on a flat note, but strengthened during the day’s trade. It opened flat at 68.49 to a US dollar from its previous close of 68.56 to a greenback.
“Indian rupee opened marginally higher against the US Dollar, thanks to risk-on sentiments across Asian markets,” Anindya Banerjee, associate vice president for currency derivatives with Kotak Securities, told IANS.
“However, demand from importers has brought it back above 68.50 levels on spot, currently at 68.51. Central bank would remain active till the union budget, as they are trying to prevent a blowback of a weak currency on bond investment from FIIs.”
Notwithstanding the brief uptrend, the equity markets again plunged on the back of sustained selling pressure.
“While sharp falls in Chinese equity markets threatened to force a lower opening in Indian markets, F&O (futures and options) expiry dynamics ensured that negative sentiments were under check in the early part of the day,” Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
“Traders approached the railway budget with reduced expectations. rupee, meanwhile is seen trading firm.”