Markets decline in early trade ahead of RBI monetary policy decision

Sensex sheds 325.97 points to 79,142.04, Nifty dips 99.1 points to 24,198.40

Mumbai: Equity benchmark indices Sensex and Nifty declined in early trade on Thursday ahead of the Reserve Bank of India‘s monetary policy decision.

Continuous foreign fund outflows and weak trends in the US markets also drove domestic equities lower during initial deals.

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The 30-share BSE Sensex declined 325.97 points to 79,142.04. The NSE Nifty dipped 99.1 points to 24,198.40.

Among the 30 Sensex firms, Infosys, JSW Steel, Larsen & Toubro, Power Grid, UltraTech Cement and Tata Steel were the biggest laggards.

Tata Motors, Titan, ITC and Sun Pharma were among the gainers during the initial trade.

In Asian markets, Tokyo, Shanghai and Hong Kong traded higher while Seoul quoted lower.

The US markets ended lower on Wednesday.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,314.76 crore on Wednesday, according to exchange data.

“During the last four days FIIs have sold Rs 20,228 crore in the cash market. This is a rational thing to do given India’s elevated valuations and the concerns surrounding recession fears in the US and further issues relating to the unwinding of the yen carry trade,” said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Global oil benchmark Brent crude climbed 0.42 per cent to $78.66 a barrel.

On Wednesday, the BSE benchmark Sensex rallied 874.94 points or 1.11 per cent to settle at 79,468.01. During the day, it jumped 1,046.13 points or 1.33 per cent to 79,639.20.

The NSE Nifty jumped 304.95 points or 1.27 per cent to 24,297.50. Intraday, it surged 345.15 points or 1.43 per cent to 24,337.70.

On the macroeconomic front, the Reserve Bank’s rate-setting panel started its three-day deliberations for the next set of bi-monthly monetary policy on Tuesday amid expectations of no change in benchmark interest rate in view of concerns on inflation and economic growth remaining steady.

The decision of the RBI Governor Shaktikanta Das-headed six-member Monetary Policy Committee (MPC) will be announced later on the day.