Rate-sensitive stocks were in focus as the RBI is expected to hike repo rate by 35 basis points on Wednesday. Nifty Bank ended 0.45% lower while Nifty Auto was down by 0.26% and the realty index lost 0.7%.
Nifty IT, which is 2022’s worst sectoral performer, was the weakest of the lot, losing 1.45% with LTIMintree and Persistent down around 3% each.
“Investors mostly remained on the sidelines as they preferred waiting for the RBI monetary policy announcement. The Nifty found support around the previous low before closing a bit higher,” said Rupak De, Senior Technical Analyst at
.
The trend may remain sideways as long as the index remains within the bands of 18,600-18,800. Any decisive move on either side will induce a directional move, analysts said.
The Indian rupee weakened 1.01% to 82.6150 per dollar to mark its worst trading session in more than two-months amid chatter of corporate dollar outflows.
In the broader market, Nifty Midcap 100 ended 0.46% lower and Nifty Smallcap 100 ended 0.16% down.
“Bears kept pushing domestic indices lower amid unfavourable global cues, with significant selling in metals and IT stocks. The mood was dampened by renewed concerns over policy tightening by the Fed in response to strong economic data out of the US,” said Vinod Nair, Head of Research at Geojit Financial Services.
European and Asian markets were both trading down as fresh worries that the US Federal Reserve may raise interest rates more than anticipated eclipsed rising confidence regarding China’s economic reforms.
Among Asian stocks, Nikkei 225 ended 0.24% higher while Hong Kong’s Hang Seng was down 0.4%.
Amid fears that overseas investors are cutting their positions in local equities, the Indian rupee ended down 1.01% to 82.61 against the dollar at a one-month low.
Investors await the RBI policy meeting on Wednesday, which is expected to slow the pace of rate hikes, in light of easing food prices. “If the rate hike is above the street expectations, investors may press the panic button, which could accelerate the selling pressure,” said Shrikant chouhan, Head of Equity Research (Retail), Kotak Securities.
