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Indian shares ended lower for a third straight session on Tuesday, hit by sharp losses in metal and energy stocks. After hovering in a narrow range for most of the session however selling pressure in the final hour pushed the markets lower. The NSE Nifty 50 index closed down 0.38% at 16,240.05, while the S&P BSE Sensex fell 0.19% to 54,364.85.

The broader markets, midcap and smallcap, continued to underperform which ended lower in the range of 1.3-1.7%.

Nifty's metal and energy sub-indexes were among the top drags, plunging 5.2% and 4%, respectively. Coal India, Tata Steel and Oil and Natural Gas Corp were among the worst performers on Nifty 50, falling between 6% and 7%. Among individual stocks, Asian Paints closed 2.7% higher, after it reported a 20.6% jump in March-quarter consolidated sales revenue.

Deepak Jasani, Head of Retail Research, HDFC Securities, says “Nifty could not hold on to the intraday bounce after a weak opening. Volumes on the NSE were much lower than recent average suggesting lower activity levels from FPIs."

“The fact that the Nifty closed almost at the intraday low after making an attempt to recover does not portend well. 16341-16013 could be the band for the Nifty for the near term," he added. 

Equity mutual funds see net inflow of 15,890.3 crore in April compared with inflow of 28,463.4 crore in March. Monthly contributions into systematic investment plans fell to 11,863.1 crore after hitting an all-time high of 12,327.9 crore in March.

“The support from DII & retail investors is reducing after the heavy selloff unsteadying their optimism," said Vinod Nair, Head of Research at Geojit Financial Services.

Nagaraj Shetti, Technical Research Analyst, HDFC Securities, says,  “The short-term trend of Nifty continues to be negative. An attempt of upside bounce from the lows seems to have completed in the last two sessions and the market is placed for further weakness. The near term downside target remains at 15700 levels. On the upper side,16400-16500 levels could be a strong overhead resistance."

Snapping its two-day losing streak, the rupee appreciated 12 paise to end at 77.32 (provisional) against the US dollar on Tuesday, supported by a rebound in regional currencies and fall in crude oil prices.

Jateen Trivedi, Senior Research Analyst at LKP Securities, said: "Rupee traded in a volatile range between 77.20-77.45 after a gap up opening for the rupee, gains started fading away as risk sentiment remains on the back of geopolitical higher inflation and FII's pulling off funds from markets. The rupee has weakened strongly in past one week from 76.25 to 77.30 as the dollar index has shown a strong positive trend. 20-DMA has been supporting USD-INR moves at since the time prices broke above it. Crude price fall in the last two days has somewhat supported the rupee fall. Rupee can be seen in a range of 77.10-77.75 in coming sessions with weak undertone for rupee."

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