Sensex, Nifty little changed; banks, IT lacklustre

REUTERS - Indian shares were little changed on Friday as gains in market heavyweight ITC Ltd on the back of strong quarterly earnings helped offset lacklustre performance by banking and IT sectors.

Broader sentiment was also subdued after Wall Street cooled off on Thursday as disappointing quarterly reports from Intel Corp and from transportation companies stalled momentum in a U.S. corporate earnings season that has been better than feared.

"There is a concern which is now coming back into PSU banks, people are worried about their asset quality. That is why investors are getting cautious and booking profits there," said Neeraj Dewan, director at Quantum Securities.

The Nifty Bank index and the Nifty Private Bank index fell as much as 0.66 percent and 0.51 percent, respectively, after earnings from HDFC Bank and Kotak Mahindra Bank on Thursday raised concerns about bad loan ratios in the sector.

Some amount of profit-taking and shuffling was taking place since there had not been a major correction in the market, Dewan added.

The broader NSE index was up 0.12 percent at 8,519.90 as of 0626 GMT after declining as much as 0.24 percent earlier in the session. The benchmark BSE index was 0.05 percent higher at 27,725.73.

For the week, the NSE index was down 0.2 percent and the BSE index was lower 0.3 percent.

Axis Bank, Federal Bank and Vijaya Bank are some of the banks scheduled to report later in the day.

Meanwhile, ITC shares rose as much as 2.2 percent after the country's biggest cigarette maker on Thursday reported a more than 10 percent rise in net profit for the first quarter.

Biopharmaceutical company Biocon Ltd rose to a record high after profit topped estimates, and the company and Mylan said their regulatory submission for proposed Biosimilar Pegfilgrastim, a drug used to bolster white blood cells in cancer patients receiving chemotherapy, was accepted for review by the European Medicines Agency.

(Reporting by Tanvi Mehta in Bengaluru; Editing by Subhranshu Sahu)