Indian shares closed lower on Thursday as investors booked profits in cement stocks after a stellar rally this week and amid caution ahead of the US payrolls data, which is expected to give a better idea about the Federal Reserve's likely policy stance. The benchmark BSE index ended 0.41 percent lower at 28,106.21, while the broader NSE index closed 0.39 percent down at 8,709.55.
Among the cement stocks, UltraTech Cement fell 1.8 percent after rising about 4 percent over the last three trading sessions, while ACC Ltd closed 0.5 percent lower after a gain of 3 percent in the last four sessions. US services sector activity hit an 11-month high in September, an encouraging sign for economic growth that may increase the prospect of a Federal Reserve rate hike this year.
October payrolls data out on Friday is expected to give a better idea about the Fed's likely stance. "Markets have taken cognisance of the fact that there are a lot of events to look up to; taking stock of the situation is what we are seeing now," said Anand James, chief market strategist at Geojit BNP Paribas Financial Services. "It looks like the focus will now be on companies' performance and other macro cues." An oil price rally overnight also lifted sentiment, with Bharat Petroleum Corp Ltd rising as much as 5.19 percent to a record high, while Reliance Industries Ltd climbed 2.80 percent.
Oil prices rose to their highest since June on Wednesday after a fifth unexpected weekly drawdown in US crude inventories raised hopes that major producers would agree to cut output next month. The Nifty Energy Index climbed as much as 3 percent to its highest in more than two years, pushing up the broader NSE index. Among losers, Yes Bank Ltd fell 3.73 percent after the Mint financial daily reported that a probe by India's capital markets regulator found the company had violated fund-raising rules.