Sensex slips in choppy session...Nifty ends below 5500

The F&O expiry session did live upto its billing with the key stock indices fluctuating through the day before closing marginally lower. The indices ended in the negative terrain, extending the losses from the previous session. The market witnessed fair amount of volatility with the NSE Nifty swinging nearly 80 points and the BSE Sensex gyrating almost 250 points during the day.

The Indian market opened higher but could not build on the early gains. The indices fell to the day's low in the afternoon trade before recovering later. However, the intraday pullback could not be sustained and the indices fell modestly after a late bout of oscillations linked to the derivative settlement.

Benchmark indices remained in the red in the 1st half of the trading session and struggled for direction. However, a fresh bout of buying saw the Nifty rise to day’s high of 5537 aided by long rollovers in Bank Nifty. VWAP based selling in the last half hour saw the Nifty erase ~44 points towards the end.



Finally, the Sensex ended at 18,078, down 67 points or 0.4% from the last close. It earlier touched a day's high of 18,250 and day's low of 18,005.

The Nifty settled at 5,483, down 22 points or ~0.4%. It hit a day’s high of 5,537 and day’s low of 5,461.

Technically, the 30 point gap-up, which was created on February 15, has acted as a strong support for the Nifty.

Among the BSE sectoral indices, the BSE Realty index was the top loser, down by 2.4%. The BSE Metal index and BSE Auto index fell 1.4% and 0.9% respectively. While, the FMCG index rose 0.8% and BSE Power index gained 0.4%.

The BSE Mid-Cap index and the BSE Small-Cap index fell 0.6% and 0.9% respectively.

The Advance-Decline ratio on the BSE was yet again in the favor of the bears. On the BSE, 1786 stocks declined against 1092 advancing stocks. While, only 108 stocks were unchanged.

"Earlier, the Indian market declined, tracking weakness in Asian peers and high oil prices. Markets in the US and Europe also fell on Wednesday amid concern that the long-running debt crisis in the eurozone was having an adverse impact on the global economy.

Doubts over the effectiveness of the second bailout for Greece is also acting as a dampener for the world equity markets following a strong start to the year. The market is also jittery about the outcome of the Uttar Pradesh elections and its implications on the upcoming Union Budget. Inflation remains sticky, stoking speculation over the RBI's next policy move at a meeting next month," says Amar Ambani, Head of Research, IIFL.

South Korea's Kospi Index lost 1%, while Australia’s S&P/ASX 200 index slipped 0.2%. Hong Kong’s Hang Seng Index dropped 0.8%, and the Shanghai Composite index edged up 0.1%.

However, Japan’s Nikkei Stock Average climbed 0.4%, erasing early-session losses as exporters extended the week's gains from a weak yen.

The sentiment was cautious after data released yesterday showed continued contraction in China's manufacturing sector for February while a composite PMI for the debt-stricken eurozone too decelerated in February.

The weak eurozone data reminded investors that the region's troubles have not ended with the second bailout for Greece.

Taiwan cut its 2012 GDP growth forecast yesterday while US sales of previously owned houses missed economists’ forecasts, adding to the worries over a worldwide economic slowdown.

Political uncertainty weighed on the Sydney market, as Prime Minister Julia Gillard said that she would hold a vote for leadership of the ruling Labor Party and government next Monday following the resignation of Foreign Minister Kevin Rudd.

European stock markets opened mostly flat but recovered on an encouraging report on German business sentiment. However, they could not sustain the tempo after the European Commission said it sees a mild recession in the eurozone.