BSE Sensex Trades Flat, Nifty Near 8,450

BSE Sensex and Nifty were flat today as traders remained cautious ahead of the release of economic growth data for July-September on Friday and the Reserve Bank of India's policy review on December 2 amid rising pressure on the central bank to cut interest rates.

Sensex was down 23 points to 28,315 while Nifty fell 10 points to 8,452.

Market analyst Sharmila Joshi said there is an overhang over the Sebi's new rules on a popular instrument used by foreign investors to invest in Indian equities.

Securities market regulator Sebi on Monday it was revising rules for offshore derivative instruments to bring them in line with new foreign investment norms approved earlier this year, raising worries about flows from overseas.

Market analyst Sarvendra Srivastava said despite yesterday's selloff, the bullish set-ups are still intact, But 8,368 is crucial level for Nifty and below this level the selling pressure could accelerate, he added.

Some buying was seen in midcap and smallcap stocks after they suffered a selloff yesterday. On Tuesday, BSE midcap index fell nearly 1.5 per cent and smallcap index slumped over 2 per cent.

Cigarette makers rebounded on Wednesday with ITC gaining over 2.5 per cent to top the 50-share Nifty index in morning trade. Shares in India's largest cigarette maker had fallen 5 per cent yesterday after the government accepted tough tobacoo measures such as banning the sale of unpackaged cigarettes.

Morgan Stanley said the proposed ban was a "clear sentiment negative" for ITC, but it added that banning the sale of loose cigarettes would be difficult to implement and advised investors to buy ITC shares on dip.

Some buying was seen metal, oil & gas and capital goods stocks. Shares of BHEL, ONGC and Sesa Sterlite were up nearly 1 per cent.

Banking stocks saw some selling pressure today after their recent outperformance. HDFC Bank, HDFC and ICICI Bank were up over 0.5 per cent.

In other global markets, Asian stocks edged up today after upbeat US economic growth data calmed investor anxiety over a deteriorating global outlook, while the Australian dollar languished near four-year lows against the dollar.

Oil prices were also under pressure as major oil producing nations failed to agree on curbs to output ahead of an OPEC meeting on Thursday.