The BSE Sensex advanced by 28 points to close at 32,186.41 today after early gains were undone by late sell-off by participants amid uninterrupted capital outflows by foreign funds.

Intra-day, the benchmark Sensex rallied about 190 points in initial trade on widespread gains.

Sentiment took a dramatic change particularly in the last one hour of trading with the lower opening of the European markets and investors started booking profits in broader markets at record levels, brokers said.

Investors were cautious after retail inflation rose to a five-month high in August and industrial production grew by 1.2 per cent in July against 4.5 per cent a year ago.

The 30-share Sensex opened strong and stayed in the positive zone for the major part of the session to hit a high of 32,348.30, but succumbed to late sell—off by investors dragged in down to a low of 32,126.77, before ending 27.75 points, or 0.09 per cent higher at 32,186.41.

The gauge has now gained 524.44 points in five straight sessions.

The 50—share NSE Nifty which surged to 10,131.95, met with resistance and finally ended 13.75 points, or 0.14 per cent down at 10,079.30, breaking its four—session long winning streak. It had gained 176.85 points in the past four trading sessions.

Losses in BPCL, IOC, ITC Ltd, Indiabulls Housing and Eicher Motor dragged the index into the negative zone.

Shares of drug makers, which have been among the big losers this year, climbed on Wednesday, with Sun Pharmaceutical Industries Ltd up 4.02 per cent, and Dr.Reddy's Laboratories Ltd rising 2.09 per cent.

The Nifty Pharma index fell 13.7 per cent as of August-end, but has gained about 3 per cent so far this month.

Bank shares also gained on hopes of additional capital infusion from the government, with Bank of India Ltd and Union Bank of India Ltd up more than 3 per cent and 1.67 per cent, respectively.

The Nifty PSU Bank index has recovered slightly this month after slumping 11.6 per cent in August.

Among other gainers, shares of Reliance Industries Ltd climbed nearly 4 per cent to hit a record high, while financial firm Capital First Ltd hit a more than 9-year high after India's banking regulator raised its foreign investment limit to 50 per cent.

Foreign portfolio investors (FPIs) sold shares worth a net Rs 1,230.74 crore yesterday, as per provisional data released by stock exchanges.

Domestic institutional investors (DIIs) bought shares worth a net Rs 1,313.08 crore as per provisional data.

Stock-specific action

Shares of Tata Power Co Ltd rose as much as 7.03 per cent, its biggest intra-day percentage gain gain since July 10.

The stock ended at Rs 85.05, up Rs 4.05 or 5 per cent on Wednesday.

Over 31 million shares changed hands vs 30-day average volume of 4.1 million.

Analysts cited market speculation that the company may sell some of its stake in Tata Group companies to Tata Sons, in a move to reduce the complex cross-holding structure of the conglomerate

Other Tata units, Tata Global Beverages and Tata Chemicals Ltd on Tuesday proposed to sell up to 10.5 million and 43.2 million shares they held in each other, respectively, to Tata Sons

Shares of Tata Chemicals finished 0.66 per cent or Rs 4.20 higher at Rs 637.50, while those of Tata Global Beverages ended down 1.53 per cent or Rs 3.25 at Rs 208.80.

Up to Tuesday’s close, Tata Power shares had gained 6.7 per cent this year.

Global markets

Globally, Asian markets mostly ended mixed with Hong Kong’s Hang Seng falling 0.28 per cent, while Shanghai Composite Index rose by 0.14 per cent and Japan’s Nikkei by 0.45 per cent.

Europe was also mixed, with Paris CAC 40 rising 0.06 per cent and Frankfurt up 0.01 per cent. UK’s FTSE fell 0.56 per cent in early trade.

Analysts opined that the indices would continue to rise in the near term, although advances would be tempered by caution over global risk factors and the domestic economy.

Data late on Tuesday showed India's consumer price inflation rose more than expected to a five-month high of 3.36 per cent, dampening chances of a rate cut by the central bank at its policy review next month.

The UN Security Council voted unanimously to boost sanctions on North Korea on Monday, but a tougher initial US draft was weakened to win the support of China and Russia, both of which hold U.N. veto power.

“The Korea tensions have eased and the markets are near all time high,” said A.K. Prabhakar, head of research at IDBI Capital Markets & Securities Ltd.

Disappointment over the timing of Apple’s iPhone X release hampered further gains for world stock markets on Wednesday after an easing of concerns about North Korea sent indices to record highs. With Tokyo gaining on a broadly weaker yen, MSCI’s main indicator of Asian shares hit a 10-year peak, but Europe’s main markets all dipped in early trade.

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