Mumbai, Dec 1 (IANS) Lack of major triggers coupled with uncertainty over the upcoming US rate hike subdued the Indian equity markets as a barometer index closed flat on Tuesday.
Initially, both the bellwether indices of the Indian equity markets opened on a positive note following Monday’s late night reforms initiated by the finance ministry in accordance with the market regulator and the Reserve Bank of India (RBI).
The modest growth in the gross domestic product (GDP) for the second quarter, which showed a gradual recovery in the country’s economy, cheered the markets.
However, the gains were capped after a slowdown in demand was indicated by a lacklustre eight core industries (ECI) and purchasing managers index (PMI) data.
Nevertheless, investors kept an optimistic outlook with the RBI announcing that it will maintain an accommodative stand on future rate cuts and that the economy is eventually limping towards a marked recovery.
Furthermore, positive cues emanated from hopes that the European Central Bank (ECB) will announce a stimulus package during its next monetary policy meet slated for December 3.
The barometer sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE) closed with gains of 24 points during the day’s trade.
Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) made modest gains. It closed higher by 20 points or 0.25 percent at 7,954.90 points.
The Sensex of the BSE, which opened at 26,201.27 points, closed at 26,169.41 points, up 23.74 points or 0.09 percent from the previous day’s close at 26,145.67 points.
The Sensex touched a high of 26,246.02 points and a low of 26,121.52 points in the intra-day trade.
Analysts elaborated that the markets traded in a narrow range with a positive bias as investors looked for further cues, especially from parliament on key reforms.
“Last night’s reforms and modest rise in the second quarter GDP data gave an initial boost to the markets, but the momentum was deflated due to concerns over a demand slowdown as indicated by ECI and PMI data,” Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
“Some positive bias emanated out of expectations of a stimulus package being announced for EU.”
Investors are hopeful that the European Central Bank (ECB) will announce a stimulus package during its next monetary policy meet slated for December 3, after latest data showed that Germany’s GDP growth has slowed.
Vaibhav Agarwal, vice president and research head at Angel Broking, said that the monetary policy remained a non-event, as it came on expected lines with no changes announced in key lending rates.
Sector-wise during the day’s trade, metal, healthcare and oil and gas indices gained, while automobile, banking and consumer durables indices came under selling pressure.
The S&P BSE metal index augmented by 226.18 points, healthcare index gained by 174.47 points and oil and gas index was was higher by 77.99 points.
The S&P BSE automobile index receded by 109.71 points, banking index declined by 57.94 points and consumer durables decreased by 42.40 points.
Major Sensex gainers during Tuesday’s trade were Vedanta, up 4.66 percent at Rs.94.25; Dr.Reddy’s Lab, up 3.31 percent at Rs.3,212.80; Tata Steel, up 3.30 percent at Rs.237.65; Coal India, up 3.27 percent at Rs.341.50; and Hindalco Industries, up 3.24 percent at Rs.79.55.
The major Sensex losers were Bharti Airtel, down 3.53 percent at Rs.322.70; Gail, down 1.79 percent at Rs.358.70; Axis Bank, down 1.54 percent at Rs.461.65; Tata Motors, down 1.41 percent at Rs.417.40; and Infosys, down 1.08 percent at Rs.1,076.65.