The Sensex and the Nifty ended the session marginally in the red despite positive global cues. Dip in WPI inflation to 5.43 per cent in June failed to enthuse the investor sentiment.
The 30-share BSE index Sensex ended down 17.37 points or 0.07 per cent at 25,006.98 and the 50-share NSE index Nifty ended down 5.45 points or 0.07 per cent at 7,454.15.
Rajesh Agarwal of Eastern Financiers said in a report: "We expect markets to extend last week’s volatility. Both Rail Budget and Union Budget failed to woo the investors despite being delivered along the expected lines. The markets in the coming week will also seek direction from two important data announcements – the WPI and the bank deposits as also credit growth. Threat of drought have started to emerge due to poor monsoon,this might act as a dampener for investors’sentiment.
The markets will also keep a watch on how things pan out on the Portugal front. Any negative development has the potential of causing FII sell-off in the Indian markets which could lead to significant correction."
Among BSE sectoral indices, consumer durables, IT and TECk indices fell the most by 2.24 per cent, 1.27 per cent and 0.99 per cent, respectively. On the other hand, capital goods, auto, metal and power indices remained investors' favourite and were up 1.14 per cent, 0.99 per cent, 0.97 per cent and 0.76 per cent, respectively.
Hindalco, Tata Power, Tata Steel, Tata Motors and Axis Bank were the major Sensex gainers, while the major losers were Infosys, HUL, Wipro, SSLT and NTPC.
According to experts, investors will shift their focus to the ongoing quarterly earnings, development on the GAAR front and progress of monsoon for further cues.
The market movement is likely to be more subdued this week as investors will turn their attention towards corporate earnings. Also, investors will resort to profit-booking as stocks had risen to unjustified levels in the pre-budget rally.
Action of the foreign portfolio investors after the Budget announcements will also be of interest.
Stocks rose around the world after a gauge of global shares had its biggest weekly loss in three months.
Asian share markets edged higher on Monday as euro zone banking jitters faded, but investors remained cautious ahead of corporate earnings and a raft of global economic events including testimony from the head of the Federal Reserve.
Investors were also looking out for a slew of economic indicators due to be released this week, starting with inflation data from Europe and US retail sales on Tuesday.
China, the world’s second biggest economy, will release GDP and industrial production figures on Wednesday, while Federal Reserve chief Janet Yellen will conclude a testimony before the US Congress on the same day.
Yellen’s remarks as well as upcoming corporate earnings reports in the United States will be monitored for hints on the health of the world’s biggest economy and top oil consuming nation, analysts said.