The benchmark indices on Indian equity markets closed flat on Thursday, due to the selling pressure prevalent in global markets. The S&P BSE ended 0.33 per cent lower at 56,409 level, 188 points down from the previous session while Nifty50 closed at 16,818, down 41 points.

During the early trade, the indices snapped the six-day losing streak and opened higher on Thursday, however, the indices took a U-turn and reversed gains.

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Gainers during the session were ONGC, Hindalco, Apollo Hospital, ITC, and Dr Reddy. Among the laggards were Asian Paints, Hero Moto, Tech Mahindra and Bajaj Auto.

The market participants seemed to be maintaining ‘wait and watch’ policy and looking forward to the outcome of the Reserve Bank of India’s (RBI) monetary policy committee (MPC) meeting on Friday for further cues.

The MPC started deliberations on the keenly awaited monetary policy amidst expectations of a 50 basis points hike in interest rate to check inflation and improve foreign capital inflow to arrest rupee depreciation against the US dollar.

The S&P BSE MidCap rose 0.31% to settle at 24,512.97 level. In the broader markets, the Nifty MidCap, and SmallCap indices added 0.4 per cent, and 0.6 per cent, respectively. S&P BSE SmallCap was up 176 points and settled at 28,047.

RBI is expected to hike its policy rate by 50 basis points for the third time in a row as the rupee’s plunge to a record low complicates the battle against inflation.

The Indian rupee strengthened against the dollar in the morning trade as expected. The Bank of England’s decision to buy long-dated British bonds prompted a pullback in Treasury yields and the dollar index. The local currency closed at 81.94 versus dollar on Wednesday.

Sugandha Sachdeva, vice-president for commodity and currency research, Religare Broking, said most of the Asian currencies, including the local unit, are reeling under pressure amid the monetary tightening campaign in the West and concerns about a global economic slowdown.

Limited intervention by the RBI amid declining forex reserves is also leading to the current bout of selling spree witnessed in the Indian rupee.