Sensex falls 34 pts on weak outlook

ICICI Bank,SBI and HDFC Bank ended with marked gains,while Hero MotoCorp,Maruti Suzuki,Bajaj Auto and Tata Motors ended in losses.

Reliance Industries,with heaviest weight on Sensex,fell 1.57 per cent and auto major Maruti Suzuki by 2.65 per cent.

The oil and gas sector index suffered the most,down 1.16 per cent,followed by auto which fell 0.91 per cent. The metal sector lost 0.26 per cent.

After gaining 354 points yesterday amid firm global markets — on hopes of another rescue plan for Greece and expectations that the US Fed will take steps to stimulate its economy — the market turned cautious.

Meanwhile,IMF said yesterday that it expects India’s economic growth rate to moderate to 7.5-7.75 per cent in 2011 and 12,from 8.5 per cent in the last fiscal,on account slowing investments and sluggish global recovery.

The BSE 30-share index,Sensex,touched a high of 17,191.12 but fell back after mid-session on weak European openings and settled at 17,065.15,down 34.13 points or 0.20 per cent.

The broader NSE 50-issue Nifty also fell 6.95 points or 0.14 per cent to 5,133.25.

“Investors took a cautious approach and covered some short positions amid speculation the US Federal Reserve will do more to stimulate economic growth after a two-day policy meeting that concludes today,” said Parag Doctor,Associate VP at Motilal Oswal Securities.

Indicating retail investor participation,second-line shares attracted good buying support,as BSE-Smallcap and BSE-Midcap indices outperformed the Sensex with a rise of 0.71 per cent and 0.73 per cent respectively.

Asian markets,except Hong Kong,closed in the green. Key indices in China,Japan,Singapore,South Korea and Taiwan ended with gains of between 0.23 per cent and 2.66 per cent.

European stocks,however,were trading weak in the afternoon deals. The CAC and the DAX were down by about 0.9 per cent and the FTSE by over 0.3 per cent.

After overnight selling of a mere Rs 4.0 crore,FIIs bought shares worth Rs 378.70 cr yesterday as per SEBI data.

Overall,16 out of 30 Sensex scrips registered losses,while others finished with gains. Hero MotoCorp was the top loser from the pack,down 3.06 per cent followed by Hindalco (2.80 pc),Maruti (2.65 pc),RIL (1.57 pc),Bajaj Auto (1.49 pc),TCS (1.40 pc),HUL (1.24 pc) and Tata Motors (0.84 pc).

However,ICICI Bank rose 2.15 per cent,Jaipra Asso (2.14 pc),Coal India (1.57 pc) and Wipro (1.30 pc).

Among other sectoral indices,Consumer Durables firmed 2.04 per cent,Bankex (0.96 pc) and Realty (0.83 pc).

The total market breadth at BSE remained favourable as 1,610 stocks closed in the green,while 1,228 finished in the red. The total turnover was slightly down at Rs 2,536.54 crore from Rs 2,541.07 crore yesterday.

Company INFO More on ITC

Stocks More on HDFC Bank

STOCKS/PRE-OPEN: Sensex to start lower,await Fed

Sensex is expected to open lower on Wednesday after a 2.1 percent rise in the previous session,as concerns in Europe remain and investors await the U.S. Federal Reserve to announce measures to stimulate a flagging U.S. economy.

Yesterday’s rally was too good to last. We will look for cues from the European markets as the day progresses,said Arun Kejriwal,strategist at research firm KRIS.

He said the debt concerns in Europe will weigh on shares.

The Fed opened a two-day meeting on Tuesday that is expected to end with a decision to stock up on longer-term Treasury notes in a bid to boost a fading economic recovery. The decision is expected at 1815 GMT.

At 0254 GMT,the MSCI’s measure of Asian markets other than Japan was down 0.15 percent. Japan’s Nikkei was flat.

The Nifty India stock futures in Singapore were down 0.46 percent,indicating a lower opening for Indian market.

U.S. stocks ended little changed on Tuesday as investors waited to see if Fed would offer more economic stimulus and if Greece made progress in talks to avoid a default.

STOCKS TO WATCH

* Lupin after the drugmaker said it had received regulatory approval to sell its generic oral contraceptive tablets in the United States.

* Kesar Terminals & Infrastructure Ltd after the company received a 1.47-billion-rupee contract to set up composite logistics hub in the state of Madhya Pradesh.

FACTORS TO WATCH

* Dollar/yen near record low,wary of intervention

* Oil rises on Fed expectations

* Stocks steady ahead of Fed,euro recovers

* Wall St ends flat as early gains evaporate