Markets shrugged off higher advance tax payments by India Inc for the March quarter, with the benchmark Sensex of BSE on Monday closing flat amid inflation rising to 16-month high in February.

The Bombay Stock Exchange’s (BSE) 30-stock index settled the day at 17,164.99 points, down 0.01 per cent or 1.63 points. The key index had closed at 17,166.62 points on Friday.

Higher tax payments by corporate saw the Sensex smartly recovering early losses of 105 points, but an unrelenting inflation failed to lift the sentiment further, brokers said.

In a choppy trading session, the index shuttled between a high of 17,195.49 points and a low of 17,061.14 points.

Broad based 50-share Nifty of the National Stock Exchange ended with a drop of 0.16 per cent at 5,128.90 points.

“The market moved in a limited range and was in the red practically for the entire day. Small and mid cap companies had severe selling pressure compared to larger peers. Advance tax numbers failed to cheer the market,” Bonanza Portfolio’s Assistant Vice-President Research Equity Avinash Gupta said.

Mahindra & Mahindra dropped 2.7 per cent, whereas India’s largest lender SBI declined 1.45 per cent. However, the Large IT stocks were in demand today with Wipro, HCL Tech, TCS and Infosys gaining ground.

The wholesale price-based (WPI) inflation shot up by 1.34 percentage points over previous month in February to 9.89 per cent, driven mainly by rising prices of essential food items and the hike in excise duty on fuel announced in the Budget.

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