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Mumbai: The 30-share S&P BSE Sensex erased most of its daily gains and closed below the 25,000-point level on Monday ahead of the swearing-in of a National Democratic Alliance government, headed by Narendra Modi.

Dealers expect trading to be choppy over the rest of the week as the new cabinet settles in.

The Indian rupee, too, slipped from its morning highs, tracking other Asian currencies that shed gains after the US dollar strengthened. The rupee closed at 58.715 per dollar, down 0.35% from its previous close of 58.5075.

The Sensex closed 0.1%, or 23.53 points, higher at 24,716.88, taking gains for the month so far to 10.26%. It had gained nearly 2%, or 481.87 points, to 25,175.22 points earlier in the day.

The National Stock Exchange’s (NSE’s) broader 50-share CNX Nifty declined 0.11%, or 8.05 points, to end at 7,359.05 points.

NSE’s India VIX—a gauge of near-term market volatility—jumped 12.1% to close at 19.8400—hinting at choppy times ahead.

“The markets (equities) sheds its early gains in the second half with strong profit-booking seen across the board in mid-caps and small-caps, high beta sectors like realty, infrastructure, PSU (public sector units), banking and power sectors," said Jayant Manglik, president (retail distribution) at Religare Securities Ltd.

Foreign institutional investors have turned sellers in stock futures in recent days, he said, adding that the markets are expected to remain volatile in the rest of the week. Manglik expects immediate technical resistance for Nifty at the 7,430 and 7,500 levels, and said that supports are seen at 7,250 and 7,200 levels.

Much of the volatility was felt in the mid-cap and small-cap space. The S&P BSE Mid-cap index and the S&P BSE Small-cap index shed 2.1% and 2.2%, respectively, the first declines in seven sessions.

Among specific stocks, gainers included Mahindra and Mahindra Ltd, which jumped 6.23% to 1,230.30, and Sesa Sterlite Ltd, which climbed 4.24% to 279.20. Tata Motors Ltd rose 2.76% to 443.30 while Wipro Ltd advanced 3.18% to 504.55.

Shares of Bharat Heavy Electricals Ltd fell 4.79% to 259.40 each while those of Tata Power Co. Ltd lost 4.11% to 101.40 each.

The Bharatiya Janata Party’s Narendra Modi led his party to a decisive victory in the April-May general election, securing 282 seats in the 545-seat Lower House of Parliament.

The former Gujarat chief minister was sworn in on Monday evening, along with his council of ministers.

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