Mumbai: Indian shares flip-flopped on Tuesday, weighed down by banks and metals, while Infosys Technologies rallied after it raised full-year forecast and reported a smaller-than-expected drop in quarterly profit.
Investors were also cautious ahead of November factory output data, due by noon. A Reuters poll expects the output to rise 10% from a year earlier, close to an annual rise of 10.3% in October.
By 9:56am, the 30-share BSE index was trading down 0.01% at 17,524.21, with 21 of its components declining. The 50-share NSE index was down 0.1% at 5,242.
ICICI Bank led the losses, falling 1.7%, while top lender State Bank of India eased 0.9% on market expectations the sector’s December quarter earnings could be muted due to sluggish loan growth.
“In our view, banks might underperform the market over next six months, with worries like lower December quarter performance, impending rate hike and slow credit growth,” said Vaibhav Sanghavi, director of Ambit Capital.
Infosys was trading 3.5% higher after the No. 2 outsourcer raised its full-year forecast, underscoring a recovery in demand for outsourcing.
“The guidance has been slightly above our expectations. This shows that revenue growth is definitely happening. Only their margins will be under some pressure because of the rupee appreciation,” Neeraj Dewan, director of Quantum Securities.
Sector leader Tata Consultancy was up 3.6% and Wipro climbed 3.4%.
Metals dropped on the back of a decline in base metals prices. Sterlite Industries and Hindalco shed 2.7% and 1.2% respectively.
In the broader market, gainers led losers in a ratio of 1.5:1 on volume of 162 million shares.