Nifty hovers around 7,650; Private banking majors weigh

ICICI Bank, HDFC Bank, IndusInd Bank down between 0.2%-1.4% each

Markets have turned flat as market players have turned cautious ahead of the two day crucial FOMC meet of the US Federal Reserve that starts tonight.

At 11:45am, the S&P BSE Sensex was up 1 point at 25,150 and the Nifty50 was down 1 point at 7,646.

The US Fed Reserve meets tonight for the last meet of the year. At the end of the two day meet, the central bank is widely expected to raise the interest rates for the first time in almost a decade thus signalling signs of recovering in the world’s largest economy.

The rupee was trading higher at 66.98 to the US dollar compared to the previous close of 67.11 in the previous session

Back on the home turf, the consumer price index (CPI) data released by the government after market hours on Monday showed that the consumer inflation hit a 5-month of 5.41% in November.

However, the FMCG and Consumer Durable shares have shrugged off the data and are trading firm with 0.5% gains on the Sensex.  ITC and Hindustan Unilever were up 0.5%-1.3% each. Among other stocks in the sector, Emami was up 1%, Godrej Consumer Products rose 0.7% while Colgate-Palmolive was up 0.6%.

Banking and financial shares are under pressure in anticipation of the rate hike by the US. ICICI Bank, Punjab National Bank and IDBI Bank were trading lower more than 1% each, while Canara Bank, Andhra Bank, Bank of Baroda, State Bank of India (SBI), Syndicate Bank and Oriental Bank of Commerce down 1% each.

Auto shares extended their losess on concerns that the proposed ban on diesel vehicles by the NGT in Delhi could have a domino effect on other states. However, the NGT has agreed to hear the plea of car dealers’ today.  M&M, Maruti Suzuki has gained 0.4% each while Tata Motors has dropped 0.7%

Sun Pharma was up 1% after the company announced the divestment of its Bryan, Ohio, US manufacturing unit following an agreement Nostrum Laboratories Inc.

On the commodity front, Gold has slide again and the metal looked vulnerable to a drop back to multi-year lows on expectations of a US rate hike later this week.

From the metal pack, Hindalco, Vedanta, Tata Steel, and Jindal Steel have all dropped between 1%-2% each.

The oil stocks have firmed up after crude prices steadied on Tuesday, however, supply glut fears continues to linger. ONGC, Reliance Industries, Gail (India), Cairn India have gained between 0.1%-1.1% each.

Among other shares, Force Motors has rallied 15% to Rs 3,160 on the BSE in otherwise weak market on back of heavy volumes.