Indian equities ended the volatile session lower on Wednesday as investors turned cautious ahead of the outcome of US Federal Reserve's two-day meeting ending later in the day. Banks, financials and FMCG stocks traded lower while metals, auto and pharma stocks gained.
At the close, the benchmark 30-share index, BSE Sensex declined 77.94 points or 0.13% at 58,927.33 with 10 components posting drop. Meanwhile, the broad based NSE Nifty closed flat with a decline of 15.35 points or 0.09%, at 17,546.65 with 20 components registering drop.
Major gainers in the 30-share index were Tech Mahindra (3.70%), Mahindra & Mahindra (1.92%), HCL Technologies (1.29%) Bajaj Auto (1.12%), Reliance Industries (1.10%), Tata Steel (1.03%) and ITC (0.81%).
On the other hand, HDFC (1.46%), Nestle (1.22%), Kotak Mahindra Bank (1.19%), ICICI Bank (1.12%), HDFC Bank (0.99%), Hindustan Unilever (0.97%), Axis Bank (0.85%) and Larsen & Toubro (0.42%) were the major losers in the Sensex.
Market breadth was positive with 2,099 advances against 1,140 declines.
The broader market outperformed and made come back with midcap and small cap indices up more than 1%. Realty index has zoomed 8.6% to hit a new high on expectation of strong demand ahead of festive season, with several lenders already announcing a rate cut. Nifty Media surged 13.6%, following a sharp rally in heavyweight Zee after the media company's board unanimously provided an in-principle approval for the merger between Sony Pictures Networks India and ZEE.
Global markets have calmed and now trading with caution in anticipation that the Federal Reserve may move a step closer to tapering but may not start immediately. Worries also eased as China Evergrande Group reached an agreement with one of its bond holders that would allow it to avoid falling into default.
However, Crude oil prices rose sharply after the latest API inventory data showed stockpiles still falling sharply in light of two hurricanes that disrupted the energy production and distribution complexes in the Gulf of Mexico.
Commenting on the market outlook, Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services said, 'Going ahead market might continue with its consolidation for sometime led by fragile global cues. Tomorrow investors would react to the US Fed MPC outcome while they would await ECB outcome tomorrow. Expectation of continuation of dovish stance by both central banks are running high. On the domestic front, with active cases falling to 6-month low, and vaccination robust pace continuing along with Government’s proactive policies, sentiments continue to be buoyant with regards to healthy economic recovery. However, given rich valuations, one cannot ignore intermittent volatility and hence traders should navigate cautiously.'
