Indian shares closed little changed on Tuesday as investors were cautious ahead of Federal Reserve Chair Janet Yellen's speech later this week at the gathering of central bankers in Jackson Hole, Wyoming, for further cues on US interest rates. The benchmark BSE index ended 0.02 percent higher at 27,990.21, while the broader NSE index closed up 0.04 percent at 8,632.60.
As the earnings season draws to a close, investors' focus will shift to Federal Reserve Chair Janet Yellen's speech on Friday at the annual central bankers' meeting in Jackson Hole, Wyoming, to assess the odds of an interest rate hike in the coming months. Broader sentiment also remained edgy with Asian shares inching higher, while oil prices fell for a second straight session on supply concerns.
Foreign investors have been buying into Indian shares apart from those in other emerging markets this year, with Friday marking their 30th consecutive session of purchases, bringing the total net investments in the year to $5.85 billion. But a rate hike by the Federal Reserve could pause the liquidity-driven rally in Indian stocks, which have risen about 24 percent from their February lows, analysts say.
"There's some bit of caution ahead of the Fed announcement as a rate hike will definitely stall this rally that we have seen in Indian stocks and result in some selling pressure," said Rikesh Parikh, vice-president of equities at Motilal Oswal Securities. Sentiment was also muted ahead of the expiry of the derivative contracts on Thursday. Among the gainers, Reliance Infrastructure Ltd rose 2.4 percent after the company completed the sale of its cement unit to Birla Corp Ltd on Monday.
Shares of Indraprastha Gas gained as much as 7.8 percent to a record high of 786.60 rupees after the company posting about 44 percent jump in its June-quarter profit, ahead of market expectations. But oil refiner Hindustan Petroleum Corp fell 3.9 percent despite posting a near 30 percent jump in its June-quarter profit on profit-booking.
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