Benchmark indices Sensex and Nifty gave up most of their initial gains after investors turned cautious ahead of September futures and options (F&O) expiry Thursday amid weak Asian cues after the US Fed raised interest rates for the third time this year.
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Investor sentiment was briefly boosted after the government Wednesday raised import duties on 19 items, including jet fuel and air conditioners, as it looks to check the widening current account deficit resulting from high crude oil prices and the rupee dipping to a historic low.
However, the 30-share BSE index, after rising over 169 points at the outset on short-covering in view of ending September series expiry in the derivatives segment and strength in the rupee, turned choppy and was trading 56.18 points, or 0.15 per cent, higher at 36,598.45 at 0930 hrs.
The gauge had lost 109.79 points on Wednesday.
The 50-share NSE Nifty also turned volatile and was up 18 points, or 0.16 per cent, at 11,071.80 after touching a high of 11,084.55.
Top gainers include Asian Paints, Tata Motors, Infosys, Wipro, SBI, NTPC, Aani Ports, Bajaj Auto, TCS, Yes Bank, Hero MotoCorp and RIL, rising up to 1.91 per cent.
Major losers were HDFC, M&M, ICICI Bank, Vedanta, Bharti Airtel, HDFC Bank, Coal India and ITC, falling up to 0.61 per cent.
The rupee strengthened by another 22 paise to quote at 72.38 against the dollar in early trade at the forex market.
Meanwhile, domestic institutional investors (DIIs) bought shares worth a net of Rs 1,555.44 crore, while foreign portfolio investors (FPIs) sold shares worth a net of Rs 809.95 crore Wednesday, provisional data showed.
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Elsewhere in Asia, Shanghai Composite Index shed 0.39 per cent, Hong Kong's Hang Seng was down 0.34 per cent in their early deals. Japan's Nikkei too fell 0.13 per cent.
The US Dow Jones Industrial Average ended 0.40 per cent lower Wednesday.