Stock markets pare gains to close lower, Nifty falls below 24,000

Mumbai: Stock markets surrendered early gains and settled lower in volatile trade on Tuesday with Sensex losing 166 points and Nifty ending below the 24,000 level due to fag-end selling in banking and telecom stocks.

Rupee, meanwhile, recovered from its all-time low level and settled for the day 16 paise higher at 83.93 (provisional) against the US dollar on Tuesday, on suspected intervention by the Reserve Bank.

Falling for the third straight day, the 30-share BSE Sensex settled at 78,593.07, down 166.33 points or 0.21 per cent, as 17 of its constituents declined and 13 gained.

The index opened sharply higher and rallied further 1,092.68 points or 1.38 per cent to a high of 79,852.08 on value-buying by investors. However, the barometer faltered later and hit a low of 78,496.57 as banking shares came under selling pressure.

Similarly, the NSE Nifty declined 63.05 points or 0.26 per cent to settle below the 24,000 level at 23,992.55. The index surged 327 points or 1.35 per cent to 24,382.60 in intra-day trade but failed to hold onto gains.

"The domestic market tried to rebound mirroring the Asian markets. However, momentum was short-lived and closed below the threshold level of 24,000. Investors are watching the appreciating Yen, weak US economic data, and rising geopolitical tensions," Vinod Nair, Head of Research, Geojit Financial Services said.

From the 30 Sensex pack, State Bank of India, Mahindra & Mahindra, Bharti Airtel, Titan, HDFC Bank, IndusInd Bank, Axis Bank and Bajaj Finance were the biggest laggards.

JSW Steel, Tech Mahindra, Larsen & Toubro, Hindustan Unilever, HCL Technologies and Reliance Industries were among the gainers from the pack. The RBI Monetary Policy Committee started three-day deliberations on Tuesday. The RBI governor will announce the bi-monthly policy on Thursday.

Asian markets also rebounded sharply, where Seoul, Tokyo, and Shanghai settled significantly higher. Hong Kong, however, ended lower. Japan's benchmark Nikkei 225 share index soared as much as 10.7 per cent early Tuesday, a day after it plunged the most in 37 years. European markets were trading in the negative territory. The US markets ended with deep cuts on Monday.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 10,073.75 crore on Monday, according to exchange data. Global oil benchmark Brent crude climbed 0.30 per cent to $76.52 a barrel.

Rupee recovers
Forex traders said mixed to weak global equities on rising concerns over recession fears in the US and the geopolitical tensions in the Middle East dented investor sentiments. Moreover, the sentimental impact of unwinding the Yen carry-trade weighed on the riskier currencies such as the rupee. However, suspected intervention by the Reserve Bank supported the local unit.

At the interbank foreign exchange market, the local unit opened at 83.92 and touched an intra-day high of 83.84 and a low of 83.97 against the dollar during the session. It finally settled at 83.93 (provisional) against the American currency, up 16 paise from its previous close.

On Monday, the rupee slumped 37 paise to settle at an all-time low of 84.09 against the US dollar.