Sensex, Nifty retreat from record highs to close flat ahead of key US Fed rate decision

Mumbai: Benchmark indices Sensex and Nifty hit intra-day record high levels before closing almost flat on Monday due to profit-taking in FMCG and IT shares by cautious investors ahead of the key US Fed interest rate decision later this week.

The 30-share BSE Sensex closed higher by 23.12 points or 0.03 per cent at 81,355.84 -- its all-time closing high -- with 16 of its components advancing and 14 ending lower.

The index opened higher and jumped 575.71 points or 0.70 per cent to hit a new intra-day record peak of 81,908.43 in late morning deals following a decline in US bond yields. However, investors preferred to book profits at record high levels amid high volatility dragging the index lower to close flat.

The NSE Nifty ended marginally up 1.25 points or 0.01 per cent at an all-time closing high of 24,836.10. During the day, it surged 164.9 points or 0.66 per cent to hit a fresh lifetime peak of 24,999.75.

From the Sensex pack, Larsen & Toubro rose the most by 2.77 per cent after it announced bagging new large orders worth Rs 2,500 crore to Rs 5,000 crore.

UltraTech Cement, which announced the acquisition of 32.72 per cent stake in India Cements from promoters and their associates for Rs 3,954 crore, closed up 1.42 per cent. India Cements closed lower by 0.65 per cent.

Bajaj Finserv, Mahindra & Mahindra, State Bank of India, IndusInd Bank, Reliance Industries and Sun Pharma were among the biggest gainers.

On the other hand, Titan Ltd fell the most 2.38 per cent. Bharti Airtel (2.22 per cent), ITC (1.33 per cent), Kotak Mahindra Bank (1.04 per cent) and HDFC Bank (0.68 per cent) were among the major losers, dragging the key indices from record highs.

IT shares Tech Mahindra, TCS, Infosys, and HCL Tech fell up to 1 per cent ahead of the US Fed meeting on interest rates.

"Nifty ended almost flat after a volatile session. Asian stocks started the week with gains ahead of central bank policy meetings in the US, the UK and Japan," said Deepak Jasani, Head of Retail Research, HDFC Securities.

In the broader market, the BSE smallcap gauge jumped 1.17 per cent and the midcap index climbed 0.80 per cent.

The BSE smallcap index hit its all-time high level during the day.

Among the indices, capital goods surged 2.73 per cent, industrials rallied 2.33 per cent, realty (1.51 per cent), oil & gas (1.17 per cent), energy (0.96 per cent) and power (0.76 per cent).

IT, telecommunication, utilities and teck were the laggards.

"An ease in the US personal consumption expenditure to 2.5% and the subsequent drop in the US 10-year yield have fuelled optimism that the Fed might cut rates in September, leading to a global rally. However, profit-booking was triggered in the domestic market given trading in the overbought territory and closed flat," said Vinod Nair, Head of Research, Geojit Financial Services.

Mixed global cues and the underperformance of major banks are causing an intermediate pause in the index, Ajit Mishra – SVP, Research, Religare Broking Ltd said.

In Asian markets, Seoul, Tokyo, Shanghai and Hong settled in the positive territory. European markets were trading on a mixed note. The US markets rallied on Friday.

Foreign Institutional Investors (FIIs) bought equities worth Rs 2,546.38 crore on Friday, according to exchange data.

Global oil benchmark Brent crude declined 0.31 per cent to USD 80.88 a barrel.