Equity benchmark indices hit all-time highs on Wednesday morning but afternoon trade wiped out early gains as shares of the oil marketing companies slipped sharply into the red.
The markets opened on an upbeat note on the expectation of an interest rate cut by the Reserve Bank of India (RBI) on Thursday. The BSE S & P Sensex opened at 39,167, saw a low of 38,826 and closed 180 points lower at 38,877.
At the National Stock Exchange, all sectoral indices were in the negative territory at the closing bell. The NSE Nifty 50 slipped 69 points to wind up the day at 11,644.
The sentiment turned negative after a report said that India's monsoon rains could be below normal this year.
Besides, shares of the oil marketing companies slipped after the Brent crude extended rise for the fourth consecutive trading session. Bharat Petroleum was down 4.6 per cent, Indian Oil 2.9 per cent and GAIL 2.5 per cent.
Zee Entertainment lost by 2.5 per cent while Larsen and Toubro, State Bank of India and Yes Bank also tumbled by over 2 per cent.
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However, Indiabulls Housing Finance, Bajaj Finserve, Maruti, HCL Tech and Tata Steel gained.
Stock market expert Sunil Shah said the benchmark indices could go up further if corporate earnings for the last quarter of 2018-19 are above expectations.
"There has been a lot of buoyancy in the market in the past few weeks. Foreign portfolio investors are bringing money back to India. The geopolitical scenario and macro-economic numbers in India also suggest a bullish trend," he said.
Meanwhile, most Asian shares rose to 7-month highs as investors seemed happy over signs of progress in trade talks between the United States and China.
Reassuring factory activity data from the world's two biggest economies helped improve the sentiment further.
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