Mumbai: The BSE benchmark Sensex erased initial gains on profit selling - although still trading 103 points up in the afternoon - as the Reserve Bank kept the key lending rate unchanged despite the industry demand for lowering it.
The Sensex, which had climbed to 18,715.03 at the outset in its nine-day long rally amid a spate of economic reform measures by the government, eased to trade at 18,566.95 -- still showing a gain of 102.68 at 1210 hrs.
Brokers said sentiment slightly dampened after the RBI announced a cut in CRR by 0.25 percent - the percentage of deposits banks keep with the bank but refrained from reducing lending rates in view high inflation.
The RBI decision, which comes days after a slew of measures taken by the government to push growth, made investors cautious as the central bank did not cut interest rates despite demands from the industry to lower them to spur growth, they said.
Shares of retail, aviation and cable companies Monday soared by up to 33 percent following the government decision to open these sectors to overseas investors.
The broad-based National Stock Exchange index Nifty was up by 32.25 points to 5,609.90 at the same time, after rising to 5,652.20 in early trade.
A fall in stocks of IT, FMCG and healthcare sectors mainly influenced the trading sentiment, while rise in realty, capital goods and banking sectors kept the market in the positive zone.
PTI
First Published: Monday, September 17, 2012, 09:47