Trading started on a weak note following profit taking mainly in technology stocks, which recently saw rally, amidst poor guidance from top software exporter Wipro, which posted 7.7 per cent increase in consolidated net profit in Q4.
The market immediately recovered on buying in auto, financials and metal stocks, though it witnessed choppiness ahead of tomorrow's derivatives expiry.
It witnessed across-the board panic selling in mid- afternoon trade news came in that rating agency Standard and Poor's (S&P) has downgraded India's rating outlook to negative from stable, citing a slowdown in investment and economic growth and a widening in the current account deficit.
Finance Minister Pranab Mukherjee's statement that there is no need for panic calmed the market to some extent and helped it to cut losses. Buoyancy in European markets too supported the sentiment.
The 50-share Nifty swung widely between a high of 5,236.10 and a low of 5,160.65 before closing at 5,202.00, a loss of 20.65 points, or 0.40 per cent, over its last close.
Wipro, RPower, Gail, Siemens, IDFC, BHEL, RCom, ACC, Ranbaxy and TCS were the top losers from the Nifty pack.
Sterlite Industries, Hero MotoCorp, Sesa Goa, Bharti Artel, Cairn, Maruti, Tata Power, Dr Reddy's, L&T and HDFC Bank ended with good gains.