Indian shares closed little-changed on Tuesday, with a rise in autos and realty balancing out a fall in information technology stocks ahead of a widely expected rate hike pause by the U.S. Federal Reserve, as well as the Reserve Bank of India this week.
The blue-chip Nifty 50 index closed 0.03% higher at 18,599, while the benchmark S&P BSE Sensex rose 0.01% to 62,792.88.
Seven of the 13 sectoral indexes advanced, with auto rising 1.09%. The auto index hit a new record for the third session in a row. Realty stocks also gained over 1%.
The gains were offset by the slide in high-weightage information technology (IT) stocks, which lost nearly 2%. Tech Mahindra Ltd, Infosys Ltd, HCLTech Ltd, Wipro Ltd and Tata Consultancy Services Ltd, were among the top Nifty 50 losers.
Domestic brokerage Kotak Institutional Equities said that the recent run-up in the sector has been above fundamentals and warned that IT firms are not immune to a global slowdown.
"India's equity market continues to be attractive despite rich valuations due to strong earnings growth and a swelling bid from both domestic and foreign investors," analysts at Morgan Stanley wrote in a note on Monday.
Meanwhile, recent macroeconomic data bolstered hopes of a pause in the rate hiking cycle by the Fed at its meeting on June 14.
Investors also await the Reserve Bank of India's monetary policy decision due on June 8, when the central bank could leave its key interest rate unchanged, a Reuters poll of economists showed.
Among individual stocks, Maruti Suzuki India and Tata Motors Ltd rose nearly 2% each and were among the top Nifty 50 gainers, following their robust May sales data.
