Sensex pares initial gains, ends 45 points down

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The Sensex on Monday washed out early gains and closed down 45 points, dragged down by oil&gas, banks and metal shares, amid reports that the country's manufacturing sector in August witnessed the weakest growth rate in nine months.

Traders said the market sentiment was also hit as the government-BJP stand-off over CAG report on coal block allocation continued even on Monday, signalling the possibility of a washout of the remaining four days in the Monsoon session.

The BSE benchmark index, which jumped to the day's high of 17,509.99, fell back sharply to end with a loss of 45.16 points, or 0.26 per cent at 17,384.40.

Reliance Industries, ICICI Bank and Tata Motors pulled the 30-share index down. Jindal Steel, which lost 2.23 per cent led the 17 Sensex losers, followed by Tata Power, Tata Steel and ONGC. ITC was unchanged.

Among the 12 winners, Bajaj Auto gained 3.04 per cent while CIL, Cipla, Bhel gained between 1-2 per cent.

"The Parliament remained disrupted for ninth consecutive day, along with weaker manufacturing data released which shows the numbers at nine-month low levels underpinned the bearish sentiment," said Nidhi Sarswat, Senior Research Analyst, Bonanza Portfolio.

Brokers said reports that HSBC India Manufacturing Purchasing Managers' Index (PMI) – a measure of factory production – easing to 52.8 in August, from 52.9 in July. sparked off some selling.

The market received another jolt as reports said Morgan Stanley lowered India's growth forecast to 5.1 per cent for the current fiscal from 5.8 per cent, citing high fiscal deficit and renewed weakness in external demand.

The 50-share National Stock Exchange index Nifty ended down by by 4.75 points, or 0.09 per cent at 5,253.75.

Among the sectors, the BSE Realty sector index suffered the most by losing 0.86 per cent, followed by BSE Oil and Gas index by 0.80 per cent.

The BSE-Bankex dropped by 0.65 per cent and the BSE-Metal index eased by 0.59 per cent.