Mumbai, July 26 (IANS) Profit booking, along with caution ahead of two major meetings and negative global indices, subdued the Indian equity markets on Tuesday.
However, lower level value buying aided the key indices to trade marginally in the green during the mid-afternoon trade session.
Healthy buying was witnessed in consumer durables, metals and information technology (IT) stocks.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) inched down by 3.30 points or 0.04 per cent to 8,632.35 points.
The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 28,121.37 points, traded at 28,113.82 points (at 2.00 p.m.) — up only 18.48 points or 0.07 per cent from the previous close at 28,095.34 points.
The Sensex has so far touched a high of 28,141.49 points and a low of 28,058.31 points during the intra-day trade.
In contrast, the BSE market breadth was tilted in favour of the bears — with 1,325 declines and 1,232 advances.
Both the key Indian indices had ended on a higher note during the previous trade session on Monday, due to short covering, expectations of key reforms and healthy inflow of foreign funds.
The equity markets also touched their new closing highs in almost a year.
On a closing basis, the NSE Nifty had touched a new 52-week high, whereas the BSE Sensex reached its highest closing levels in 11 months.
The barometer index had gained by 292.10 points or 1.05 per cent to 28,095.34 points, while the NSE Nifty edged up by 94.45 points or 1.11 per cent to 8,635.65 points.
Initially on Tuesday, the benchmark indices opened on a flat-to-positive note in sync with their Asian peers.
However, negative Japanese indices, lower crude oil prices and a weak rupee dented sentiments.
Besides, investors were seen cautious ahead of Finance Minister Arun Jaitley’s meeting with his counterparts from the states to discuss proposed amendments to the GST (Goods and Services Tax) Bill.
The pan-India tax reform has been passed by the Lok Sabha but is stuck in the Rajya Sabha, where the government lacks a majority.
It is widely expected that the bill will be listed for discussion in the Rajya Sabha following Jaitley’s consultations with the Empowered Committee of State Finance Ministers.
Nevertheless, a logjam in parliament has spooked investors over the prospects of the bill getting passed.
In addition, volatility was flared by the start of the US Fed’s FOMC (Federal Open Market Committee) meet.
The meet assumes significance as it will decide whether or not to increase interest rates. A hike in the US interest rates can potentially lead FPIs (Foreign Portfolio Investors) away from emerging markets such as India.
On the other hand, healthy quarterly earnings, above average monsoon rain falls and value buying supported prices at lower levels.
According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, Nifty faced resistance at higher levels due to profit booking and volatility in USD/INR future prices.
“IT sector stocks traded with sideways to firm sentiments supported by recovery in USD/INR futures,” Desai told IANS.
“Most Sugar sector stocks traded down on profit booking.”