Mumbai: Investor anxiety — on the eve of RBI’s monetary policy review — over whether the apex bank would cut key lending rates led a barometer index of the Indian equities markets to end flat on Monday.
The benchmark index of the Indian equities markets, the 30-scrip Sensitive Index (Sensex) closed only 21 points – or 0.07 percent – up after the day’s trade.
The wider 50-scrip Nifty of the National Stock Exchange (NSE) also closed flat. It ended the day’s trade marginally down by 0.25 points at 8,433.40 points.
The Sensex of the S&P Bombay Stock Exchange (BSE), which opened at 27,770.79 points, closed at 27,848.99 points, up 20.55 points or 0.07 percent from the previous day’s close at 27,828.44 points.
The Sensex touched a high of 27,959.43 points and a low of 27,737.58 points in the intra-day trade.
Analysts tracking the day’s trade pointed out that after a weak start, the markets were seen trading directionless ahead of the RBI’s policy meet on Tuesday.
This was despite the HSBC India PMI (purchasing managers index) jumping to a four-month high on the back of growth in production and on the rise in new orders. The data stood at 52.6 in May from 51.3 in the previous month.
“Markets seemed to be keenly awaiting for the rate cut by RBI in its policy scheduled tomorrow on one hand and weak monsoon prediction on the other threw mixed bag of sentiment on the bourses. Few auto industry monthly sales numbers failed to cheer the street,” said Gaurav Jain, director, Hem Securities.
Vinod Nair, head of the fundamental research with Geojit BNP Paribas Financial Services said that other than the negative impact from Sun Pharma, market has floated ahead in the hope of a rate cut.
“A cut of 25 basis points is the most likely consensus. A cut with dovish outlook will provide further support to the market. The immediate momentum of the market will depend on tomorrow’s event outlook, equity market has high expectation from the event, a cut with hawkish view will not be welcomed by the market,” Nair said.
Meanwhile, during Monday’s trade healthy buying was observed in the capital goods, fast moving consumer goods (FMCG) and oil and gas stocks. However, stocks like healthcare, banks and automobile came under heavy selling pressure.
The S&P BSE capital goods index augmented by 330.39 points, FMCG index gained by 81.53 points and oil and gas index rose by 66.49 points.
However, healthcare index receded by 475.18 points, bank index was lower by 117.30 points and automobile index fell by 65.71 points.
The major Sensex gainers on Monday were: Larsen and Toubro (L&T), up 3.03 percent at Rs.1,705.50; Reliance Industries, up 2.76 percent at Rs.901.35; Maruti Suzuki, up 2.52 percent at Rs.3,880.90; Hindustan Unilever, up 2.31 percent at Rs.879.70; and Cipla, up 1.81 percent at Rs.662.20.
The losers were: Sun Pharma, down 8.99 percent at Rs.878.95; Bharti Airtel, down 2.12 percent at Rs.416.30; Tata Motors, down 1.96 percent at Rs.472.15; ONGC, down 1.79 percent at Rs.324.05; and HDFC Bank, down 1.42 percent at Rs.1,036.15.
Among the Asian markets, Japan’s Nikkei closed marginally higher by 0.03 percent. China’s Shanghai Composite Index was higher by 4.72 percent, and Hong Kong’s Hang Seng increased by 0.63 percent.
In Europe, London’s FTSE 100 edged up by 0.17 percent. France’s CAC 40 was higher by 0.84 percent, and Germany’s DAX Index rose by 0.52 percent at the closing bell here.