Benchmark equity indices Sensex and Nifty closed lower for a second straight day on Tuesday due to selling in FMCG, metal and auto shares ahead of the RBI monetary policy.
The 30-share BSE barometer declined further by 220.86 points or 0.37% to close at 60,286.04, as 22 of its constituents ended in the red. The index opened flat amid mixed global trends. It moved in a range of 60,655.14 to 60,063.49 in the day.
The broader Nifty of the National Stock Exchange fell by 43.10 points or 0.24% to settle at 17,721.50, with 31 of its scrips ending in the red. The index touched a high of 17,811.15 and a low of 17,652.55 during the session.
Profit-taking in the FMCG and auto majors was weighing on the sentiment while buying in select heavyweights in banking and financials capped the fall, analysts said.
"Sentiments in the domestic market were hammered by bears that dominated the U.S. market post the release of strong jobs data. Global markets are currently driven by central bank policies and the surge in bond yields in expectation of more rate actions," said Vinod Nair, Head of Research at Geojit Financial Services.
A recovery was seen in the second half of the day as U.S. futures inched higher as investors await U.S. Fed Chief Jerome Powell’s speech, Mr. Nair added.
Among Sensex stocks, Tata Steel fell the most by 5.23% after posting weak financial results for the December quarter. The steel maker slipped into the red in the third quarter due to a drop in revenue and higher cost.
ITC, Sun Pharma, Maruti, M&M, Tata Motors, HCL Tech, Wipro, Infosys, HUL, Bharti Airtel and Reliance were among the major losers.
Banking stocks gained ahead of the RBI monetary policy announcement on Wednesday.
Kotak Bank rose the most by 1.59%, followed by IndusInd Bank (1.22%), SBI (0.32%) and HDFC Bank (0.10%).
Bajaj Finance, Bajaj Finserv, L&T, SBI, TCS, and HDFC Bank also closed higher. "Participants are closely eyeing the outcome of the RBI meet for cues. However, indications are pointing toward prevailing choppiness to continue until Nifty decisively breaks the range of 17,550-17,900 levels," Ajit Mishra, VP - of Technical Research, Religare Broking Ltd said.
Adani group stocks, which have been hammered following the Hindenburg Research report alleging stock manipulation and accounting fraud by the Gautam Adani-led group, ended their decline.
Adani group flagship Adani Enterprises rose by 14.63% after hitting the upper circuit during the day. The stock was the lead gainer among Nifty50 stocks.
Adani Ports and Special Economic Zones (APSEZ) advanced 1.33% despite a decline in profit for the December quarter.
APSEZ CEO and whole-time director Karan Adani said the company is considering a total loan repayment and prepayment of around ₹5,000 crore, which will significantly improve the net debt to EBITDA ratio.
Adani Wilmar gained 4.99%, ACC rose 1.32% and Ambuja Cement increased 1.12%.
Adani Green Energy, which posted two-fold growth in Q3 profit, declined by 5%. Adani Transmission, Adani Total Gas and Adani Power also dropped.
In the broader market, BSE Midcap edged up 0.02% while Smallcap index declined by 0.16%.
Among sectoral indices, the BSE metal index fell the most by 1.89%, followed by telecom (1.31%), Utilities at 1.15%, FMCG (1.13%) and Auto (0.92%).
BSE Bankex gained 0.29%, Capital goods rose by 0.49% and Realty by 0.77%.
Global stock markets were mixed as investors looked ahead to a speech by the Federal Reserve chief for clues to interest rate plans.
In Asia, the Nikkei 225 in Tokyo declined 0.1%, while Shanghai Composite Index rose 0.3%, and the Hang Seng in Hong Kong advanced 0.6%. In Europe, the FTSE 100 in London gained 0.3%, while Frankfurt's DAX fell 0.4%, and the CAC 40 in Paris lost 0.3%.
Foreign portfolio investors were net sellers on Monday, offloading shares worth ₹1,218.14 crore, according to data available with the BSE.
The international Brent crude futures rose 0.79% to $81.78 per barrel.