Sensex edges down; on track for second weekly gain

By Darshana Sankararaman

(Reuters) - Indian shares were trading marginally lower on Friday after two sessions of gains and were on track for a second winning week, with investors keeping to the sidelines ahead of the central bank's policy meeting next week.

The Reserve Bank of India is expected to cut interest rates to help revive demand at its monetary policy review on Feb. 8, though this is not seen as a certainty.

Sentiment has improved after the government on Wednesday unveiled a federal budget that was aimed at helping the poor with hikes in government spending and cuts in taxes, while raising the fiscal deficit target to only 3.2 percent from an earlier target of 3 percent.

"The market is consolidating after the strong rally on the budget day," said Vinod Nair, head of research at Geojit BNP Paribas Securities.

"Going forward, the focus will be on the RBI meet next week," he added.

The broader NSE Nifty was down 0.13 percent at 8,723.10 by 0544 GMT, but was up 0.94 percent for the week.

The benchmark BSE Sensex was 0.13 percent lower at 28,190.50, but was up 1.10 percent for the week.

Auto stocks continued to fall for a second day, and were among the biggest percentage losers on the NSE after weak January sales. Tata Motors Ltd was down 1 percent.

IT stocks fell after strong gains in the previous session. Infosys Ltd and HCL Technologies Ltd were down 1 percent each, after gaining nearly 2 percent on Thursday.

Sun TV Network Ltd surged as much as 26 pct to an all-time high after a special CBI court on Thursday dropped all charges against former telecom minister Dayanidhi Maran and Sun TV promoter Kalanithi Maran in the Aircel-Maxis case.

Asia's oldest stock exchange BSE Ltd surged as much as 48.9 percent on its trading debut.

(Reporting By Darshana Sankararaman in Bengaluru; Editing by Vyas Mohan)