Indian shares closed higher on Tuesday after struggling for direction, as investors awaited the Union budget, while most Adani Group stocks rebounded from their recent slide.
The Nifty 50 index closed 0.07% higher at 17,662.15, while the S&P BSE Sensex rose 0.08% to 59,549.90. Both benchmarks fell over 2% in January, their second straight monthly loss.
The move in the benchmarks mirrored the intraday trajectory of the heavyweight financials index, which closed marginally higher, after its drop in the wake of the US-based Hindenburg Research's scathing report on the Adani Group.
"Financials have seen some pressure in the wake of the Hindenburg report but the fundamentals continue to remain strong," said Astha Jain, senior research analyst at Hem Securities.
Investors will now focus on the Union budget, due on Wednesday. Besides the government's fiscal consolidation path and borrowing calendar for fiscal 2024, traders will also watch for any incentives to entice foreign investors.
Foreign institutional investors offloaded 151.65 billion rupees ($1.86 billion) worth of shares since the Hindenburg report on Adani Group. The conglomerate's seven listed companies have lost $66 billion in market value since the report last Wednesday.
Most of the Adani Group stocks rose on Tuesday, with the flagship Adani Enterprises climbing 2.8% on the last day of its crucial $2.5 billion follow-on share offering. Its secondary share sale got subscribed 110% as of 3:30 p.m. IST on the final day of the offer.
Adani Ports, Adani Green, Adani Transmission, ACC, Ambuja Cements and NDTV also logged gains.
IT stocks slid 1.18% and capped gains in the market. The US Federal Reserve's policy decision on February 1 would be key for IT firms, which have major exposure to the United States.
