Sensex flat; IT stocks fall on US visa cost worries

RIL slips 4%; however, rate-sensitive stocks continue to gain on hopes of rate cut

The Sensex came off two-week highs to end flat today, as Reliance Industries fell after posting quarterly revenues that missed analyst estimates and after software services exporters fell on concerns about potentially higher US visa costs.

A fall in European stocks as investors switched to stronger markets in the United States and Asia, where economic growth prospects are brighter due to massive central bank stimulus, also pulled down local shares.

However, rate-sensitive stocks continued to gain on hopes of a rate cut at the Reserve Bank of India's (RBI's) rate-setting meeting on May 3, on the back of easing inflation.

Reliance Industries fell the most in six months, down 3.9 per cent after the company's January-March quarter revenue came in below expectations. IT providers fell on worries that a bill proposing stiff fee increases and stronger visa regulation will hit their margins.

Tata Consultancy Services fell 1.8 per cent, while HCL Technologies gave up early gains after better-than-expected profits, to end 1.5 per cent lower.

"Earnings have been mixed so far. The market is too volatile, it has become a fool's game. There is too much happening globally and locally but the net feeling in market is positive," said

P Phani Sekhar, fund manager, portfolio management services at Angel Broking.

"RBI rate cut is a given now. Also what happens globally should be watched."

The BSE Sensex fell 0.07 per cent, or 13.77 points, to 18,731.16.

The 50-share Nifty ended flat at 5,688.70, with both indexes hitting their highest level since April 3 earlier in the session.

ITC hit an all-time high, continuing to extend gains for a fifth session, on recent media reports of a hike in prices of some categories of cigarettes. It ended 1.7 per cent higher.

Rate-sensitive stocks continued to extend gains on hopes of a rate cut at the May 3 review.

Lenders rose with State Bank of India gaining 2.8 per cent, while auto stocks like Mahindra & Mahindra rose 4.3 per cent.