The Sensex and Nifty ended lower on Tuesday, reversing course from record highs hit in early session as markets paused ahead of the central bank's policy meeting.
The benchmark BSE index closed down 118.93 points or 0.38 per cent at 31,190.56, after hitting a record high of 31,430.32.
The broader NSE index ended 37.95 points or 0.39 per cent lower at 9,637.15. The index breached 9,700 points for the first time early in the session.
The Reserve Bank of India is likely to keep interest rates unchanged at 6.25 per cent at its review on Wednesday, but likely to sound less hawkish than the last monetary policy committee meeting, according to a Reuters poll.
Sentiment was also subdued after Asian shares fell amid a slew of risk factors, including escalating tensions in West Asia, the coming testimony of the former FBI director, British elections and a European Central Bank meeting.
Among BSE sectoral indices, IT index was the star-performer and was up 2.33 per cent followed by TECk 1.64 per cent. On the other hand, consumer durables index was down 2.01 per cent, power 1.62 per cent, realty 1.36 per cent and FMCG 1.35 per cent.
Top five Sensex gainers were TCS (+3.63%), Infosys (+2.00%), Wipro (+0.91%), Dr Reddy's (+0.61%) and Adani Ports (+0.26%), while the major losers were Tata Motors (-3.58%), NTPC (-2.65%), ONGC (-2.28%), ITC (-2.05%) and L&T (-1.6%).
IT and TECk stocks surged on sustained buying and positive economic data in the US — the biggest outsourcing market for Indian IT companies.
Broker's reaction
“Broader market is correcting as well,” said Neeraj Dewan, director, Quantum Securities.
“There isn't any reason to be bullish right now.”
ITC Ltd's shares fell as much as 2.6 per cent in their biggest intraday percentage drop in over a month and were among the top percentage losers on the NSE index.
India Grid Trust fell as much as 6.3 per cent in its debut due to lack of investor familiarity with infrastructure investment fund.
But among gainers, State Bank of India rose as much as 2 percent to its highest in two weeks after a share sale to institutional investors to raise as much as $2.33 billion was fully covered within hours of the launch on Monday, sources told Reuters.
Adani Enterprises Ltd surged as much as 6.90 per cent to its highest in one week, after the company gave final investment nod for the Carmichael coal mine and railway in Australia.