Sensex, Nifty erase early gains as profit booking weighs on markets

• Sensex and Nifty reversed their early gains to trade lower, with profit booking weighing on the market

• At 9.53 am, the Sensex was down 206.11 points at 72,266.22, while the Nifty slipped below 22,500

• Falling crude prices supported the opening, but foreign investor selling and weakness in some Asian markets remained in focus

Indian equity benchmarks surrendered their early gains on Monday as investors booked profits at higher levels following Friday’s sharp rally, pushing the Sensex and Nifty into negative territory.

At 9.53 am, the BSE Sensex was down 206.11 points, or 0.28 per cent, at 72,266.22. The NSE Nifty declined 31.10 points, or 0.14 per cent, to 22,489.35, slipping below the psychologically significant 22,500 level.

The Sensex had retreated about 500 points from its intraday high. However, broader market breadth remained positive, with 2,284 shares advancing, 1,159 declining and 207 unchanged.

Both indices had opened higher as easing oil prices supported sentiment. The Sensex touched 72,627.86 in early trading, while the Nifty rose to 22,591.45.

Brent crude, the global oil benchmark, fell 1.45 per cent to $103.10 a barrel.

Bharat Electronics, Mahindra & Mahindra, Bajaj Finance, Trent, Tata Steel and NTPC were among the leading Sensex gainers in early trade. Tech Mahindra, Bharti Airtel, ITC and Axis Bank were among the laggards.

Banking shares also weakened, with the Bank Nifty trading 0.35 per cent lower.

Investors were assessing the Reserve Bank of India’s measures to contain rupee volatility. These include a dedicated dollar window for oil marketing companies through designated banks and higher costs for certain foreign exchange hedging transactions.

According to research reports, the measures could reduce demand for dollars in the spot market, discourage speculative positions against the rupee and absorb surplus banking liquidity, potentially easing near-term depreciation pressure.

Technical analysts said the Nifty would need to trade above 22,650 for a stronger bullish outlook to emerge.

Elsewhere in Asia, South Korea’s Kospi fell sharply and Shanghai’s SSE Composite traded lower, while Hong Kong’s Hang Seng edged higher. US markets had closed higher on Friday.

Foreign institutional investors sold equities worth Rs 3,568.90 crore on Friday, according to exchange data.

In the previous session, the Sensex gained 879.09 points, or 1.23 per cent, to close at 72,472.33. The Nifty rose 288.65 points, or 1.30 per cent, to settle at 22,520.45.

With agency inputs