Mumbai: Benchmark equity indices Sensex and Nifty pared early gains to close lower by over half a per cent on Monday due to losses in oil & gas and banking shares amid concerns over further uptick in interest rates.
Falling for the second straight session, the BSE Sensex closed lower by 311.03 points or 0.51 per cent at 60,691.54. The index opened higher at 61,112.84 and gained further around 290 points to hit the day's high of 61,290.19.
However, selling in index major Reliance Industries, HDFC twins, ICICI Bank, Maruti and Kotak Bank dragged the barometer to a low of 60,607.02.
The NSE Nifty fell 99.60 points or 0.56 per cent to end at 17,844.60 as 30 of its constituents declined while 20 advanced.
From the Sensex pack, Maruti, HDFC, Kotak Mahindra Bank, Axis Bank, Bajaj Finance, Reliance Industries, Nestle and ICICI Bank were among the major laggards.
UltraTech Cement, Tech Mahindra, Power Grid, Infosys, Tata Motors, HCL Technologies, Mahindra & Mahindra and Bharti Airtel were the major winners.
"Stocks are getting beaten ahead of the release of Fed minutes on Wednesday. Maintaining its guard against inflation, the Fed is expected to remain hawkish. As expected, it is unlikely to have a dire effect on the global stock market.
"However, the consequence of constant high interest rates is causing a slowdown in demand and the earnings outlook, hence the near-term trend will be cautious," said Vinod Nair, Head of Research at Geojit Financial Services.
In Asian markets, Japan, South Korea, Hong Kong and China ended in the positive territory.
European markets were trading lower. The US markets had ended on a mixed note on Friday.
International oil benchmark Brent crude climbed 0.95 per cent to USD 83.79 per barrel.
Foreign Portfolio Investors (FPIs) offloaded shares worth Rs 624.61 crore on Friday, according to exchange data.