Indian shares are likely to trade sideways on Thursday as investors pause after a run to record highs, with leads from other Asian markets subdued ahead of key U.S. data.
But the downside for an index that has hit all-time highs on four successive days should be limited by strong foreign fund flows that have topped $7.7 billion this year.
That has helped the key index <.BSESN> gain 15 percent since the start of September and more than 43 percent so far this year, making it the best performer in Asia-Pacific.
"We are seeing investors turn more cautious at these levels, picking specific stocks and more mid-caps," said Ketan Shah at Prabhudas Lilladher brokerage.
"But there is enough liquidity in the market to keep up the momentum, barring big profit sales."
The 30-share BSE index closed 0.33 percent higher at 13,469.37 points on Wednesday, a record close, after it scaled a record high of 13,506.08 in intra-day trade.
STOCKS TO WATCH
* Hindustan Zinc Ltd.
* Zandu Pharmaceutical Works Ltd.
* Power generation and air conditioning equipment maker Thermax Ltd.
* State-run National Aluminium Co. Ltd.
* BSEL Infrastructure Realty Ltd.
FACTORS TO WATCH * Indian bonds seen pausing ahead of auctions [IN/] * Indian rupee may edge higher on yen strength [INR/] * FOREX-Yen jumps on report China c.bank buying currency [FRX/] * Oil rises on U.S. stock fall, OPEC cut talk [O/R] * GLOBAL MARKETS-Stocks subdued ahead of data, yen jumps
[MARKETS/AS] * STOCKS NEWS ASIA-Tokyo firms on dividend hopes, Australia slips