Breakfast meeting between Timothy Geithner, US treasury secretary, leading industralists due Wednesday.
In the Sensex pack, Tata Motors was the biggest loser, shedding 3.29 per cent, followed by ICICI Bank, IndusInd Bank, Infosys, HCL Tech, Axis Bank, TCS, HUL, Asian Paints, Sun Pharma, SBI, Tata Steel and NTPC, which dropped up to 3.23 per cent.
The markets have been unable to sustain at higher levels as a rise in bond yields globally, especially in the US have dented sentiment. Surging commodity prices, especially crude oil that have now hit $70 a barrel (Brent) coupled with inflation woes and fear of sporadic lockdown across major economic hubs back home as Covid cases rise have chased the bulls away. In the short-term, analysts expect the markets to remain volatile as they react to news flow - both from overseas and developments back home. Investors, they say, need to keep a tab on how the US treasury yields move, which in turn will have a ripple effect on how big money moves across developed (DMs) and emerging markets (EMs), including India.
Instead of getting swayed by market gyrations, investors must stay invested for the long term, advises Sarbajeet K Sen.
In the Sensex pack, Vedanta took the biggest hit (5.55 per cent), followed by Tata Motors, SBI, Yes Bank, Bharti Airtel and Infosys, which lost up to 4.50 per cent.
Investor wealth on Thursday soared by Rs 1 lakh crore, triggered by heavy buying in the stock market, with the BSE benchmark Sensex surging about 382 points to close at near six-week high levels.
Key among those would be US Federal Reserve Chairman Ben Bernanke's speech late on Monday evening, fourth-quarter earnings report by information technology major Infosys Technologies and India's industrial production data during the week.
Healthy demand for the American unit from importers and corporate weighed on the rupee
The MPC headed by RBI Governor Shaktikanta Das will announce the resolution of the meeting at around noon on Thursday.
Silver ready ruled flat at Rs 44,600 per kg, while weekly-based delivery shed Rs 80 to Rs 43,780 per kg on lack of speculators' buying support.
The overall breadth is positive as 873 stocks are advancing while 425 are declining.
Analysts say that the rupee trajectory, going ahead, will be a function of flows.
"Indian markets (are) well placed to absorb the US Fed rate hike. Gradual approach in future increases augurs well for emerging markets," Economic Affairs Secretary Shaktikanta Das has tweeted.
The 50-issue NSE Nifty too cracked below the 11,400-mark and hit a low of 11,311.60, before finishing 102.65 points, or 0.90 per cent down at 11,354.25.
ICICI bank, one of the investors, has been trying to reduce its stake for long, as it has to bring it below 5 per cent on directives of the US Federal Reserve.
Gold prices plunged to over ten months low by losing Rs 505 to Rs 29,470 per ten gram in the national capital on Thursday on frantic selling by stockists amid restricted buying, driven by a steep fall in overseas markets.
While gold added Rs 310 to hit the record level, silver rose by Rs 800 to Rs 62,000 per kilogram.
The $5.7 billion total includes $1.6 billion in fines separately imposed by the US Federal Reserve on the five banks.
The yellow metal has risen 6.6 per cent since mid-August
The rupee had ended marginally down by 1 paise at 55.63 against the dollar on alternate bouts of buying and selling amid a fag-end recovery in equities in yesterday's session.
In addition, dollar's weakness against other currencies overseas also supported the rupee.
Markets extended gains in afternoon trades and touched the highs of the day with buying interest seen in banking and realty shares. The Sensex was up 247 points at 17,085. Nifty is up 81 points at 5,180.
The rupee had ended lower by 19 paise at 56.15 against the dollar on wednesday as importers bought dollars in late trade.
On Tuesday, the rupee had closed three paise down at 55.96 against the dollar amid foreign fund outflows and demand of the US currency from importers.
The broader NSE Nifty shuttled between 10,784.65 and 10,689.80, before ending 21.30 points, or 0.20 per cent, lower at 10,718.05.
The Nifty too closed lower by 80.75 points, or 0.73 per cent, at 11,049.65 after hitting a low of 11,033.90.
It hovered in a range of 63.57 and 63.70.
Weakness of dollar in the overseas market also boosted the rupee value.
Forex dealers said a higher opening in the domestic equity market and dollar's weakness against other currencies overseas after the US Federal Reserve kept its easing policy unchanged also supported the rupee.
The Fed's interpretation of the increase in gas prices is the economist's basic mantra of supply and demand.
Observing that US' economic recovery is proceeding at a moderate pace, US Federal Reserve Board chairman Ben Bernanke said on Wednesday the central bank might need to intervene if policymakers enact short-term spending cuts that hurt growth.
The planner's argument is that recent international events, such as China's good growth numbers and quantitative easing by the US Federal Reserve, will result in more fund flows in commodities.
The apex bank's observation on Tuesday comes at a time when global markets remain uncertain about the overall impact of the tsunami and the subsequently unravelling nuclear crisis in Japan.
Insufficient rainfall will have a negative impact on the economy.
Rupee down 13 paise to 66.72 against dollar
Foreign brokerage Bank of America Merrill Lynch said they expect the headline inflation to rise to 3.3 per cent in May, but added that it is within the 2-6 per cent range which the government has set for the RBI.
'If one believes that the Indian stock market will go up 70 per cent every year for the next 10 years, I wish you good luck!'
The Nifty was down 56 points, at 4,868.
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