Profit booking, caution over US rate hike subdues equity markets

Mumbai, March 28 (IANS) Profit booking, coupled with heightened chances of a US rate hike and a weak rupee subdued the Indian equity markets during the early morning trade session on Monday.

Consequently, the barometer 30-scrip sensitive index (Sensex) of the BSE traded marginally in the red.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) traded flat. It inched-up by 0.35 points at 7,716.85 points.

The Sensex, which opened at 25,417.11 points, traded at 25,327.20 points (9.30 a.m.) — down 10.36 points, or 0.04 percent from the previous day’s close at 25,337.56 points.

So far during the intra-day trade, the Sensex touched a high of 25,432.94 points and a low of 25,311.95 points.

The BSE market breadth slightly favoured the bulls — with 768 advances and 561 declines.

The barometer index had closed the last trade session flat on March 23.

The Indian equity markets were closed from March 24-25, on account of Holi and Good Friday.

On Monday’s trade, market analysts pointed out that profit booking dragged the equity markets lower.

In addition, investors were seen hesitant to chase prices due to the heightened chances of a US rate hike next month. Recent US economic growth data has increased chances of a rate hike.

A hike in the US interest rates is expected to lead away Foreign Portfolio Investors (FPIs) from emerging markets such as India.

Besides, a weak rupee and unwinding of long positions ahead of the derivatives expiry and the financial year end dampened sentiments.

The rupee opened at 66.85-86 to a US dollar from its previous close of 66.62-63 to a greenback.

Medaram Jathara

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