The benchmark index Nifty came off its two-month low in intra-day trade and ended almost flat on the National Stock Exchange (NSE) today in a highly choppy session triggered by an unexpected interest rate hike by RBI.
The market witnessed a firm start ahead of RBI policy meet, but the announcement of rate hike sparked heavy selling, leading the index to quote at 6,085.95, a two-month low, during late morning session.
The Reserve Bank, in its third quarter monetary policy review, hiked key lending rate (repo) by 0.25 per cent to 8.0 per cent and kept cash reserve ratio unchanged at 4 per cent. The apex bank said India's GDP growth is expected to fall below 5 per cent in 2013-14 and year-end inflation could exceed 8 per cent.
Heavy selling was seen in key IT, pharma and banking counters, while value buying in FMCG, metal, auto, realty and energy counters amid a tinge of short-covering ahead of monthly derivative expiry helped the market to cap losses.
Shares of small-cap companies gained while mid-caps plunged further.
Meanwhile, foreign institutional investors (FIIs) sold shares worth a net Rs 1,334.21 crores yesterday, as per provisional data from the stock exchanges.
The 50-share index hovered between a high 6,163.60 and a low of 6,085.95 before ending at 6,126.25, down 9.60 points, or 0.16 per cent, over the previous close.
Major losers were Maruti, Axis Bank, Lupin, Cipla, Sun Pharma, IndusInd Bank, Infosys, HUL, NTPC and NMDC.
Key gainers were Tata Steel, Ranbaxy, Sesa Sterlite, Hindalco, JP Associates, Tata Motors, Jindal Steel, Bajaj Auto, BHEL and DLF.
Turnover in the cash segment rose to Rs 12,780.51 crore from Rs 11,835.36 crore yesterday. A total of 6,169.12 lakh shares changed hands in 58,14,029 trades, while market capitalisation stood at Rs 65,82,382 crore.
