Benchmark share indices marginally lower on Monday, amid a range bound trading session, on account of profit taking in bank and software shares.
The 30-share Sensex ended down 106 points at 17,678 and the 50-share Nifty ended 36 points lower at 5,350.
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(Updated at 14:23 hrs)
Markets continue to trade with marginal losses in late noon deals, amid a weakening rupee and mixed global cues, dragged by banking and software majors.
At 14:20hrs, the Sensex was down 59 points at 17,724 and the 50-share Nifty slipped 21 points to 5,365.
The rupee dropped to a 1-week low in low volumes, with pair at 55.6075/6150 versus Friday's close of 55.4950/5050. It rose to as much as 55.63 in trade, the highest since Aug 20. End-of-month dollar buying from oil importers helping the cross, but foreign bank dealer say exporters seen selling at above 55.60.
In Asia, the Nikkei ended with marginal gains while the Hang Seng, Straits Times and Shanghai Composite were trading with losess between 0.2-1.7% each.
The looming recession across the euro zone kept European shares and the single currency under pressure on Monday, but moves were capped ahead of a meeting of central bankers at the end of the week which could signal fresh stimulus measures. The CAC-40 and DAX were trading flat with negative bias.
Gold rose to it highest level since mid-April on Monday, extending strong gains from last week as expectations for further monetary easing from the U.S. Federal Reserve kept sentiment buoyant. Gold in the domestic market in India touched a new record high of Rs 31,468 per 10 gm.
Among the sectoral indices on the BSE, the Bankex, Realty, Power, Metal, Capital Goods and IT were among the top losers down between 0.6-1.2% each.
Bank shares were down as hopes of a rate cut by the central bank faded as inflation continues to remain way above its comfort zone of 5%. ICICI Bank was down 1.4% while SBI slipped 1.9%. Among other financial shares, HDFC and HDFC Bank were trading with marginal losses.
Software majors were down on profit taking after gains last week. The BSE IT index ended up 3.3% in the week ended August 24. Index heavyweight Infosys and Wipro were down 1% each while TCS was marginally down.
Metal shares were down on concerns that demand would be lower on the back of weakening economic scenario in China after government data showed that profits of major industrial enterprises declined by 5.4% in July. Jindal Steel was down 4.8%, Hindalco slipped 0.7% while Sterlite Industries was trading nearly 1% down.
Among other Sensex losers. Tata Motors was down 1.2% after the Supreme Court, on Friday, sought response of Tata Motors on a special leave petition filed by the West Bengal government challenging the quashing of the Singur Land Acquisition Act by the state high court.
Sensex gainers include index heavyweight Reliance Industries up 0.8% at Rs 788 on short covering at lower levels after the stock ended 4% lower last week.
Bharti Airtel was up 1.3% after the company said that it has finalised managers to manage the initial public offering of its telecom tower business, Bharti Infratel.
Mahindra and Mahindra was up 1.4% after Bank of America-Merrill Lynch raises its target price for Mahindra & Mahindra to Rs 880 from Rs 825 and maintains the stock with a "buy" rating. BoA-ML says it expects a 5 percent decline in tractor sales in fiscal 2012-13, but that will be "more than compensated" by growing auto sales in a note dated on Monday.
The BSE Mid-cap and Small-cap indices were down 0.5% each. The overall breadth remains weak as 1,536 stocks have declined while 1,111 stocks have advanced.