Nifty facing resistance above 8,700; Sensex down over 100 points

Benchmark indices continue to remain choppy with negative bias in late morning trades as profit taking at higher levels capped upside gains. Investors have turned cautious ahead of the outcome of the US Federal Reserve’s stance on interest rates at its two-day policy meet which ends today.

At 11:35AM, the 30-share Sensex was lower by 69 points at 28,667 and the Nifty dipped 22 points at 8,701.

Meanwhile, IMF chief Christine Lagarde warned of a repeat of high market volatility and capital outflows when US Fed hikes rates next time and asked India and other emerging markets to be prepared for such an eventuality.

Foreign portfolio investors were net buyers in equities to the tune of Rs 265.52 crore on Tuesday, as per provisional stock exchange data. Domestic institutional investors (DIIs) sold shares worth a net Rs 243.69 crore.

Asian markets firmed up on renewed buying interest. However, upside gains remained capped as investors are keenly awaiting the policy statement on interest rates from the US Federal Reserve later today. Shares in Japan were trading with marginal gains after closing at fresh 15-year highs on Tuesday.

Shares in China also surged over 1% on expectations of further monetary stimulus. The benchmark Shanghai Composite Index reached its highest since May 2008, while Hong Kong’s Hang Seng was also up 1.1%.

The BSE Power index was the top loser down 0.6% along with IT and Auto indices. Metal, Healthcare and Bankex were the top gainers.

Sesa Sterlite continues to remain the top Sensex gainers, up over 2% after the Goa government said that mining operations would resume in the State after the Centre on Tuesday revoked its earlier order suspending all environmental clearances of mines.

Jindal Steel & Power which had dropped nearly 9% yesterday rebounded after the company in a release said it has not received any communication from the government with regard to re-examination of of Gare Palma IV/2 & IV/3 or Tara coal blocks which have been won by its subsidiary Jindal Power Limited (JPL). The stock is up nearly 3%.

Financial shares remained firm with SBI, HDFC Bank and Axis Bank were up 0.5-1% each.

Tata Motors was down 1.2% after the company in release said that global wholesales for Jaguar Land Rover for February 2015 were lower at 38,541 units compared to 39,011 units in February 2015.

NTPC which had gained post the announcement of bonus debebtures also witnessed profit taking. The stock was the top loser down 2.5%. The Company has fixed March 23, 2015, as the record date for determining the members/shareholders to whom the Debentures will be allotted in terms of this Scheme.

TCS, ICICI Bank, ONGC, HDFC were among the other Sensex losers.

Among other shares, Madhucon Projects is locked in upper circuit of 5% at Rs 58 on the BSE after the company received the letter of award from National Highway Authority of India (NHAI) for the project valued Rs 397 crore in Tamil Nadu.

Shares of Piramal Enterprises were trading higher by 2% at Rs 902, extending its previous day’s 6% rally on the NSE, after the pharmaceutical firm clarified that the company’s proposed investment in Health Super HiWay is subject to several pre-conditions, only upon fulfillment of which, the investment would be made.

In the broader markets, the BSE Mid-cap and Small-cap indices were up 0.4-0.5% each.

Market breadth was weak with 1,215 losers and 1,131 gainers on the BSE.