Sensex, Nifty give up gains after initial surge, end flat

In volatile trading, the benchmark Sensex and the Nifty index on Wednesday failed to sustain initial gains and ended almost flat on caution ahead of expiry of monthly derivative contracts and much-awaited Union Budget.

The BSE Sensex resumed higher at 29,115.32 and shot up further to 29,269.83 on initial strong buying on the back of overnight gains in US market coupled with good foreign capital inflows.

However, the Sensex failed to maintain initial gains due to intense selling pressure in last 90 minutes and slumped to 28,967.61 before ending at 29,007.99-a marginal rise of 3.33 points or 0.01 per cent.

The CNX 50-share Nifty also moved up by 5.15 points or 0.06 per cent to finish at 8,767.25 after hitting the day’s high of 8,840.65. …the focus is solely and largely on the Union Budget.

“We expect the markets to remain volatile and be range-bound in the near term provided the Budget meets market expectations or else, we may see steep correction in successive sessions,” said Bonanza Portfolio Ltd, Associate Fund Manager, Hiren Dhakan.

Losses in Sensex constituents including HDFC Bank, ICICI Bank, TCS, L&T, Sun Pharma and Dr Reddys dragged the BSE barometer towards the red.

The Sensex managed to end in the green because of gains in heavyweights like Infosys and ITC along with support from HDFC, Wipro and Bharti Airtel.

Reform measures undertaken by the government to accelerate growth and address fiscal and supply side constraints will determine India’s sovereign credit profile, rating agency Moody’s said.

Thursday will see markets react to the Railway Budget as well as portfolio churning by investors as monthly derivative contracts expire. After the Economic Survey on Friday, the Union Budget would be presented by Finance Minister Arun Jaitley on Saturday.

Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 697.28 crore on Tuesday as per provisional data released by the stock exchanges while Domestic Institutional Investors (DIIs) sold shares worth a net Rs 146.98 crore.

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