Flat finish for Nifty ahead of F&O expiry

The Indian markets ended almost unchanged on Wednesday as the consolidation phase continued for a second straight day ahead of the F&O expiry. Markets opened on a soft note on account of subdued global cues. In fact, the NSE Nifty fell below 5300 levels before bouncing back in the afternoon.



Fresh bad news from the debt-plagued euro-zone soured the mood not only in Europe but also in Asia. Separately, the UK announced spending cuts and tax increases to curb high budget gap, sending British shares lower. A disappointing housing sector report in the US also weighed on the sentiment.

"The Nifty hovered in a narrow range of 5290-5335. On the whole, the markets remained lackluster but the key indices did manage to recover from session lows and finally ended with slim gains. In contrast, a lot of action was seen in the broader market today," says Amar Ambani Vice President Research IIFL.

The BSE 30-share Sensex edged higher by mere 6 points to close at 17,756 and Nifty gained 6 points to finish at 5,323.

Among the BSE sectoral indices, BSE Realty index was the top gainer, up 2% followed by BSE Pharma index, it was up 1.5% and BSE Teck index up 0.9%. The BSE Mid-Cap index and the BSE Small-Cap index ended higher by 0.7% each.

On the other hand, BSE Capital Goods index was down 1.4% and BSE Metal index down 0.35%.

Outside the frontline indices, the big gainers in the broader market were REI Agro, Marico, MMTC, Apollo Hosp and Educomp. On the other hand, losers included Thermax, Max India, Jain Irrigation and Koutons Retail.

The NSE Nifty is expected to end the June F&O series around 5300. The near-term trading band for the Nifty is seen between 5200 and 5400.

Asian markets finished mixed. Japan's Nikkei Average ended down 1.9% at 9,923.70, while the Hang Seng rose 0.2% to 20,857. China’s Shanghai Composite Index decreased 1.2% while Australia’s S&P/ASX 200 Index lost 1.6%.

The MSCI Asia Pacific Index suffered its biggest drop in two weeks, after an unexpected decline in US home sales raised concerns about the strength of the world’s largest economy. The Index fell 1.3% to 116.68 at 3:01 p.m. in Tokyo, the most since June 7.

European stocks fell for a second day, following US shares lower, amid concern the economic recovery will falter. The Stoxx Europe 600 Index slipped 0.7% to 255.24 at 8:35 a.m. in London.

US stocks sank yesterday as a report showed sales of previously owned homes unexpectedly fell in May. The Standard & Poor’s 500 Index fell below its 200-day average of about 1,111. Futures on the Standard & Poor’s 500 Index rose 0.3%. The gauge dropped 1.6% yesterday, the most since June 4.

The FOMC will announce the outcome of its two-day meet later today. An announcement is expected on Wednesday afternoon regarding interest rates and the economy.

The Fed policymakers are widely expected to hold the fed funds rate, a key overnight bank lending rate, steady at historic lows near zero and to indicate that they will continue to do so for the foreseeable future. Of more interest will be the statement and what the Fed says about the economic outlook.