Profit-taking, rising oil prices tied to Middle East uncertainty and caution before the RBI policy decision weighed on Indian equities, while traders also adjusted to a new closing-auction mechanism.
India’s BSE Sensex fell about 0.3% to close at 78,429 on Tuesday, ending a four-session advance as investors locked in gains ahead of the Reserve Bank of India policy decision and reacted to renewed pressure in oil prices linked to Middle East uncertainty. Markets were also adapting to a new closing-auction mechanism for stocks with futures and options contracts, introduced on Monday. The RBI (India’s central bank) is widely expected to leave interest rates unchanged, but investors are watching for any shift toward a more hawkish stance as inflation remains above the bank’s comfort level. Among individual shares, the biggest decliners included Hindustan Unilever, NTPC, HDFC Bank, Reliance, IndiGo and Tech Mahindra, while Trent, Bajaj Finance, BEL, Tata Steel, Mahindra & Mahindra and Bajaj Finserv led the gains.