With the US Federal Open Market Committee expected to meet late today for deciding on its quantitative easing programme, Indian investors treaded with caution on Friday.

The Nifty closed at 5850.2, up by 9.65 points or 0.17 per cent today. The Sensex finished at 19,804.03, up by 61.56 points or 0.31 per cent as compared to Monday’s close.

“It was yet another choppy day of trade as the indices ended on a flat note on Tuesday. Market participants preferred to remain cautious ahead of the Federal Reserve Open Market Committee meet…the meet would be key in terms of any announcement regarding the tapering of $85 billion monthly bond purchases,” said Amar Ambani, Head of Research, India Infoline

However, if the Fed tapers over $20 billion, the rupee is likely to fall from its current levels and the Reserve Bank of India’s monetary policy could still remain tight with no change in interest rates. The new RBI Governor Raghuram Rajan would also have to take into account the rising inflation while announcing steps to boost sliding growth.

Among sectoral indices, Information Technology (up 2.05 per cent), TecK (up 1.58 per cent) and Metal (up 0.97 per cent) led the pack on the BSE, while Realty (down 1.08 per cent), bankex (down 0.73 per cent) and Power (down 0.72 per cent) were the main laggards.

On Nifty, HCL Technologies, Dr Reddy’s and Ranbaxy were top gainers while Sun Pharma, Bank of Baroda and Axis Bank were the main losers.

Market breadth was negative as 1,238 stocks advanced, 1,118 stocks declined and 129 remained unchanged.

(This article was published on September 17, 2013)
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