Sensex ends marginally lower, Nifty holds above 9,600 ahead of RBI minutes

The benchmark indices pared some intraday losses, but ended lower as investors waited for minutes of a June policy meet by the Reserve Bank of India (RBI) to gauge the direction of interest rates in the months ahead.

On the global front, muted trend seen in Asian markets following a renewed slump in oil prices to seven-month lows, also impacted the sentiment. Investors also decoded the impact of a decision by US index provider MSCI to add mainland Chinese stocks to one of its popular benchmarks.

The S&P BSE Sensex ended at 31,283, down 14 points, while the broader Nifty50 settled at 9,637, down 16 points. 

In the broader market, the S&P BSE Midcap index ended little changed, while the S&P BSE Smallcap index added 0.1%.  

The market breadth, indicating the overall health of the market, turned negative. On BSE, 1,371 shares declined and 1,263 shares rose. A total of 179 shares were unchanged.

"Lack of fresh triggers refrained market to continue its positive momentum while today’s RBI minutes will be under scrutiny to check any deviation from current neutral stance due to softening inflation.  Global markets remained volatile led by slide in oil prices due to signs of supply glut," said Vinod Nair, Head of Research, Geojit Financial Services.

Buzzing stocks

Nifty Metal index (down 1.2%) was the leading sectoral loser, led by losses in Hindalco, Hindustan Zinc and Ratnamani Metals, which slipped up to 2%. 

Oil explorers fell after global oil prices hit seven-month lows, with Oil and Natural Gas Corp falling as much as 2.5% and Oil India down as much as 1.9%.

FMCG stocks were the best peformers. HUL, Colgate Palmolive, Britannia, Emami and United Spirits gained between 1-3%.

Among other gainers, aviation companies were in focus with all the three airliners SpiceJet, InterGlobe Aviation and Jet Airways adding in the range of 2% to 3% on the BSE in an otherwise weak market after good growth in passenger traffic and lower crude oil prices.

SpiceJet was up 3% to hit its new high of Rs 131, while InterGlobe Aviation that runs IndiGo Airlines was up 2.2% at Rs 1,259, touching a fresh 52-week high on the BSE in intra-day trade. Jet Airways was up 3% to Rs 566.

Price of aviation fuel is the biggest cost factor for low-budget carriers.

Amtek Auto hit an upper circuit limit of 10% at Rs 28.15 on media reports that 21 investors showed interest to buy a stake in the debt-ridden company.

Larsen & Toubro rose as much as 1.8% after the government's Specified Undertaking of the Unit Trust of India sold a 2.5% stake in the company for more than Rs 40 billion ($619 million).

Global markets

European markets opened lower. The pan-European STOXX 600 was down 0.8%, France's CAC 40 was down over 1%, while Germany's DAX slipped 0.8%.

In Asia there had been muted reaction to global index provider MSCI's decision to add the first batch of mainland Chinese stocks to its popular emerging equity benchmark.

Indexes in Shanghai and Shenzen moved around 0.5% higher after the decision, which could ultimately bring $340 billion of foreign capital to the so-called A-share market.

The commodity and bond market turbulence and falls in Europe pushed MSCI's all-country share index down 0.3% after its 0.7% slide on Tuesday compounded by a weak close on Wall Street.

(With inputs from Reuters)