Shares ended flat on Friday, skidding from a 7-month high hit earlier in the session, as gains in agriculture-related stocks and automakers were offset by a slump in Idea Cellular Ltd.
Also, investors remained wary ahead of US jobs data that could provide some hints about the timing of the Federal Reserve’s likely move on interest rate hike.
The broader NSE index ended 0.02 per cent higher at 8,220.80, but rose 0.76 per cent this week to mark a second consecutive weekly gain. The benchmark BSE index ended unchanged at 26,843.03.
Both indexes had earlier hit their highest levels since late October.
Shares of Idea ended 11 per cent down after Providence Equity Partners sold a 3.5 percent stake in the wireless provider.
Among BSE sectoral indices, consumer durables index fell the most by 1.75 per cent, realty 1.14 per cent, capital goods 0.9 per cent and healthcare 0.73 per cent. On the other hand, banking index was up 0.82 per cent, auto 0.45 per cent, power 0.44 per cent and oil & gas 0.22 per cent.
Top five Sensex gainers were Axis Bank (+3.52%), NTPC (+2.04%), HUL (+1.86%), M&M (+1.56%) and Bajaj Auto (+1.55%), while the major losers were Bharti Airtel (-2.12%), State Bank of India (-2.02%), Lupin (-1.82%), BHEL (-1.67%) and GAIL (-1.46%).
Domestic sentiment remained buoyant on forecast of a normal to excess rainfall, recovery in earnings report card and smart GDP numbers.
The India Meteorological Department (IMD) has reiterated its initial prediction of ‘above normal’ rainfall in this year’s South-West monsoon season.
The June-September monsoon rains would be 106 per cent of the long-term average, the chief of the Indian weather office said on Thursday.
Stronger rains could cool down food prices, raising the prospect that the Reserve Bank of India would be more willing to cut interest rates again later this year.
RBI rate cut
For now, the RBI is widely expected to keep the repo rate at a five-year low of 6.50 per cent when it holds its policy review on Tuesday, after cutting it by 150 basis points since early last year.
“Expectations of a good monsoon have once again reinforced the confidence among market participants that the growth may come back on a good note, considering the consumerism in the rural side of the economy,” said Saurabh Jain, assistant vice president-research at SMC Global Securities.
A report by SMC Global said: "Asian markets advanced Friday as markets awaited key US jobs data, which will offer a key indicator of whether the Federal Reserve will pull the trigger in June. Overnight, US stocks closed at session highs Thursday, with health care stocks leading, ahead of the highly anticipated employment report due Friday morning.The services sector in China continued to expand in May, albeit at a slower pace, the latest survey from Caixin revealed on Friday with a services PMI score of 51.2. That's down from 51.8 in April, although it remains well above the boom-or-bust line of 50 that separates expansion from contraction. Among the individual components, new business, employment and volumes of unfinished work all expanded slightly in May, while total new orders saw slight decline. The composite PMI dipped to 50.5 from 50.8 in the previous month."
The MSCI world equity index, which tracks shares in 45 countries, rose 0.2 per cent to its highest level since the last day of May. A close at these levels would be its highest close since May 2.