The Nifty and the Sensex ended near flat as caution prevailed ahead of the US Federal Reserve meeting this week and the Brexit referendum next week, but the losses were contained as lenders advanced after the central bank eased the stressed asset restructuring rules.
The 30-share BSE index Sensex ended down 1.06 points or 0.00 per cent at 26,395.71 and the 50-share NSE index Nifty ended down 1.75 points or 0.02 per cent at 8,108.85.
Among BSE sectoral indices, oil & gas index fell the most by 0.52 per cent, IT 0.42 per cent, and TECk 0.37 per cent. On the other hand, infrastructure index was up 0.86 per cent, realty 0.84 per cent, healthcare 0.51 per cent and PSU 0.49 per cent.
Top five Sensex gainers were Cipla (+2.77%), Adani Ports (+2.67%), State Bank of India (+2.65%), ITC (+0.96%) and Tata Motors (+0.93%), while the major losers were Bajaj Auto (-1.00%), Maruti (-0.93%), Hero MotoCorp (-0.91%), Asian Paints (-0.89%) and HUL (-0.85%).
Bank shares were up as RBI had on Monday relaxed the guidelines for lenders restructuring large stressed loans, in a move that could allow banks to more effectively manage bad loans.
Software services exporters were among the leading decliners.
Global markets
Asian markets slumped after a survey on Friday put the 'Leave' campaign 10 points ahead, although two polls on Saturday showed voters were still closely divided, underlining the contradictory polling less than two weeks before the referendum.
Meetings of the US Federal Reserve, Bank of England, Swiss National Bank and the Bank of Japan are also awaited this week. All are likely to keep monetary policy steady.
At home, investors were also spooked after data released late on Friday showed India's industrial output unexpectedly fell in April, the first contraction in three months.
“FII (foreign institutional investor) flows have been quite healthy now, at least for the last couple of months, driven by lot of positivity in India. But this exit ('Brexit') would overshadow all the positives for India, so you would expect FII flows to revert back,” said Ravi Sundar Muthukrishnan, co-head Institutional Equity Research, ICICI Securities.
Wall Street stumbled for a third straight session on Monday as tech stalwarts Microsoft and Apple dragged on indexes and investors braced for major economic and political events in the United States and Europe.
A report by SMC Global said: "Asian stocks slipped, after the biggest three-day drop since February, amid investor anxiety before central bank meetings and Britain's vote on European Union membership. Overnight, US stocks fell for a third straight session Monday, with the S&P 500 and the Dow Jones Industrial Average finishing at their lowest close since May 24 as investors turned increasingly jittery ahead of a Federal Reserve policy meeting and a looming vote on the UK's membership in the European Union. India's consumer price inflation accelerated more-than-expected in May, preliminary figures from the Central Statistics Office showed. The consumer price index rose 5.76 per cent, which is faster than the 5.60 per cent climb economists had expected. A year ago, the rate was 5.01 per cent. The inflation figure for April was revised higher to 5.47 per cent from 5.39 per cent reported initially."