Low volumes play spoilsport

STOCK REPORT

Shares ended 1 per cent down, amid low volumes as investors stayed away from the market ahead of US Federal Reserve meet on interest rates on Tuesday.

Also, poor attendance at brokerages in Mumbai due to heavy rains affected volumes on Monday.

The Bombay Stock Exchange Sensex closed at 10812.64, down 53.87 points or 0.5 per cent.

Intraday, it moved between 10780.01 and 10869.66.

The National Stock Exchange Nifty closed 3151.10, down 25.65 points or 0.8 per cent.

Intraday, it moved between 3142.55 and 3178.50. Turnover on both exchanges together was Rs 6,100 crore , down 24 per cent from Friday. On BSE, declines outnumbered advances 1,238 to 1,157.

Other Asian markets too ended weak due to uncertainty over Fed's move on interest rates, with Japan's Nikkei ending 2 per cent down.

Lead Nifty gainer ICICI Bank remained up throughout the day, ending nearly 4 per cent up from Friday.

Other gainers included Tata Tea, up 2.3 per cent, Oriental Bank of Commerce, up 1.8 per cent, and Bharat Heavy Electricals, up 1.5 per cent.

Analysts are divided over the outcome of Tuesday's Fed meet. While some say 25 basis point hike in key rate to 5.50 per cent, 18th hike in over two years, seems imminent to contain inflation, other says Fed will take a pause because the economy is slowing down.

Dealers say this may prompt foreign investors, who were net buyers in July and in August, to invest in the Indian market.

"FII's have been net buyers for July and August so far. We may see an increase in investment by them if the Fed does not hike interest rates this time," Shiv Gupta, dealer at Jet Age Securities, said.