Sensex edges up, lack of catalysts keeps lid on gains
REUTERS – Indian shares edged up on Wednesday, but investors remained on the sidelines in the absence of strong catalysts after the market’s record-setting run early this month.
Sentiment was largely muted in Asia, with MSCI’s broadest index of Asia-Pacific shares outside Japan rising 0.1 percent. Wall Street ended nearly flat on Tuesday.
Since hitting an all-time high on Aug. 2, India’s broader NSE index has fallen more than 3 percent on profit-taking as well as a flare-up in tensions between the United States and North Korea.
Caution prevailed as a faster-than-expected rise in consumer price inflation in July reduced the chances of another interest rate cut by the Reserve Bank of India, which cut its main policy rate early this month by 25 basis points to 6 percent, the lowest since November 2010.
“There is complete lack of triggers, all the movement has been on geopolitical situation till now,” said Jayant Manglik, president, retail distribution, Religare Securities.
The broader NSE Nifty was up 0.16 percent at 9,809.00 as of 0640 GMT, boosted by ITC Ltd.
The benchmark BSE Sensex was 0.22 percent higher at 31,519.72.
Markets were closed on Tuesday for a public holiday.
Consumer stocks gained as the Nifty FMCG index rose nearly 2 percent in its biggest intraday percentage gain in over a month, recovering from recent losses sparked by worries about the impact from India’s new goods and services tax.
Nifty Auto index was trading 0.87 percent higher, with TVS Motor Company Ltd and Motherson Sumi Systems Ltd being the top percentage gainers. The sub-index has risen about 16.6 percent this year, lagging a 20 percent gain in the broader NSE index.
Among the stocks in red, Nifty PSU Bank index dropped as much as 1.5 percent to its lowest since July 10. The index has slumped 12.4 percent so far this month, following some disappointing earnings and due to concerns about RBI rate cuts.
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