Sensex, Nifty flat; oil stocks jump on crude rally

Last Updated: Thu, Dec 01, 2016 12:47 hrs

Indian shares were flat on Thursday after four straight sessions of gains, with oil producers such as Oil and Natural Gas Corp Ltd gaining on a sharp crude rally while sectors such as banks saw some profit-taking.

Investors largely ignored data released late on Wednesday that showed gross domestic product expanded by an annual 7.3 percent between July and September, given most analysts expect that to reverse this quarter after India withdrew higher-value banknotes.

Data on Thursday showed Indian factory activity decelerated sharply last month as demonetisation led to a rationing of cash and cooled domestic consumption, new orders and production.

Analysts said markets would likely remain flat over the next few sessions as investors await the Reserve Bank of India's policy decision on Wednesday, amid growing expectations that the central bank will cut rates to help offset the economic impact of demonetisation.

"Markets will remain lacklustre for the next few sessions until we get some clarity from the RBI policy meet next week," said Jayant Manglik, president, retail distribution, Religare Securities.

The broader Nifty was down 0.15 percent at 8,212.45 as of 0629 GMT, while the benchmark Sensex was 0.06 percent lower at 26,637.36.

Oil producers rose as crude prices shot up 13 percent, smashing trading volume records, after OPEC and Russia cut a deal to reduce output to drain a global supply glut.

ONGC rose as much as 3.4 percent, Oil India Ltd climbed up to 3.8 percent and Cairn India Ltd gained as much as 2.3 percent.

However, banks fell on profit-taking after the sector rallied on Wednesday when the central bank allowed lenders to use all their cash to meet cash reserve ratio requirements, not just a certain amount of the money.

ICICI Bank fell as much as 2.4 percent after rising 4 percent on Wednesday.

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