BackMarkets discounts rate cut hopes, Sensex falls 45 points
The Sensex closed 0.17%, or 45.04 points, lower after earlier falling as much as 1.1%
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Mumbai: Brushing aside rate cut hopes fuelled by soft inflation and Index of Industrial production (IIP) data, the benchmark BSE Sensex on Thursday fell by 0.17%, or 45 points, to 27,206.06 on profit-booking in export-oriented stocks such as Infosys Ltd and Tata Consultancy Services Ltd (TCS) after rupee staged a comeback against the dollar.
Sentiment continued to remain bearish on concerns over muted Q4 earnings, delay in key reform bills in Parliament and forecast of a subdued monsoon, brokers said. At the forex market, rupee surged more than 35 paise against the dollar in intra-day trade.
Meanwhile, a data on Thursday showed Wholesale Price Index (WPI) inflation declined to a new low of -2.65% in April. With inflation dropping to a new low in April, India Inc has reaffirmed demand for a rate cut, saying it provides ample space for the RBI to slash the key policy rate.
As a result, investors went on a buying spree, leading to a rise in the broader market. The BSE mid-cap and small-cap indices closed up around 0.89% and 0.92%, respectively. The 30-share BSE index slipped below the 27,000-mark in early trade to hit a session low of 26,948.62 as heavy-weights succumbed on profit-booking after Wednesday’s gains.
On gains in Hindalco Industries Ltd, State Bank of India, Bajaj Auto Ltd and Tata Steel Ltd stocks trimmed most of losses and the index settled with a fall of 45.04 points at 27,206.06.
The CNX Nifty too edged lower by 11.25 points, or 0.14%, to end at 8,224.20. Intra-day, it cracked the 8,200-mark to touch a low of 8,137.30. “Volatility continued on the fourth consecutive day in a row and key benchmark indices closed with small losses. Market trimmed losses in late trade after languishing in negative zone almost throughout the trading session," said Jayant Manglik, president-retail distribution at Religare Securities. Selling was mostly observed in IT, consumer durables, teck, capital goods and healthcare shares, while realty, oil&gas, auto, metal and power counters were in demand.
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