Sensex falls on F&O expiry day; Feb series down 6.18%

Markets ended marginally lower in choppy trade after Wednesday’s rebound in line with weakening rupee amid muted global cues and the minutes of the RBI’s latest policy meeting expressing nagging inflation concerns.

The minutes from the February 6-7 meeting showed Reserve Bank of India’s monetary policy committee members were concerned about accelerating inflation as well as uncertainty about the strength of economic recovery.

The rupee depreciated 34 paise to hit a fresh 3-month low of 65.10 (intra-day) against the dollar today at the forex market, weighing on sentiments.

In the February derivatives expiry, the Sensex tumbled by 2,230.94 points, or 6.18 % and Nifty declined by 686.95 points, or 6.20 per cent.

Traders said relentless capital outflows by foreign funds since the Punjab National Bank (PNB) disclosed that it detected fraudulent transactions with financial implication of about Rs 11,346 crore kept markets falling.

Squaring-up of positions by participants on the last trading session of February series contracts in the derivatives segment and a weak trend at other Asian markets after Federal Reserve minutes indicated US interest rates would rise further also influenced sentiment here.

The Sensex after resuming lower at 33,817.09 fell further to hit a low of 33,691.42 intra-day on foreign fund outflows.

But investors covered up their short positions at lower levels due to end of February series in the derivatives segment, helping the gauge to recover most of the lost grounds to settle the session 25.36 points, or 0.07 % down at 33,819.50. During the session, it turned positive briefly and touched a high of 33,868.74.

On Wednesday the 30-share bluechip index had gained 141.27 points.

Likewise, the 50-stock NSE barometer Nifty finished 14.75 points, or 0.14 % down at 10,382.70 after shuttling between 10,340.65 and 10,393.15.

Foreign portfolio investors (FPIs) sold shares worth Rs 1,214.18 crore on net basis, while domestic institutional investors (DIIs) bought equities to the tune of Rs 1,375.48 crore yesterday, provisional data showed.