Mumbai: Shares succumbed to heavy selling as investors turned cautious and booked profits in rate sensitive counters ahead of the RBI monetary policy, dragging the benchmark index Nifty down by 44 points on the National Stock Exchange (NSE) today.
However, FMCG counters bore the maximum brunt of the sell-off following heavyweight ITC's earnings downgrade despite reporting stellar Q2 numbers. Healthcare, metal, infra and technology stocks, too, witnessed heavy selling.
After a firm start, market lost ground in afternoon with the key index taking a sudden plunge as investors re-jigged their positions ahead of RBI's second quarter monetary policy review tomorrow. Volatility was high owing to F&O series expiry this week.
However, select buying in energy and auto heavyweights helped the 50-share index to close above the 6,100 level. All eyes will be on the outcome of policy meet, though spiralling inflation and uncertain economic situation offer Reserve Bank Governor Raghuram Rajan limited scope to cut key rates to spur growth, traders said.
Meanwhile, other Asian and emerging markets rebounded sharply from last week's plunge on growing speculation the US Federal Reserve will maintain its bond-purchase plan intact for longer-than-expected due to disappointing macroeconomic data and easing anxiety over China's financial system.
The Nifty swung between a high of 6,168.75 and a low of 6,094.10 before finishing at 6,101.10, showing a sharp fall of 43.80 points, or 0.71 per cent.
JP Associates, Bank of Baroda, ITC, PNB, DLF, Sesa Sterlite, IndusInd Bank, Tata Steel, SBIN and IDFC were the key Nifty laggards.
Prominent index gainers included L&T, ONGC, HDFC, Axis Bank, Wipro, Kotak Bank, M&M, Tata Motors, Gail and Reliance. Turnover in the cash segment declined to Rs 8,917.44 crore from Rs 9,820.23 crore last Friday. A total of 5,028.01 lakh shares changed hands in 48,36,608 trades, while market capitalisation stood at Rs 64,94,173 crore.