Indian shares surrender gains as Cipla tumbles, IT rally ebbs

BENGALURU, Nov 23 (Reuters): Indian blue-chip indexes shed early gains to end flat on Thursday, as IT stocks pulled back after a recent rally and as Cipla slumped after the US health regulator's warning letter.
The NSE Nifty 50 index dipped 0.05 per cent to end at 19,802 points and the S&P BSE Sensex settled 0.01 per cent lower at 66,017.81. Both had risen about 0.3 per cent during the session.
Cipla sank nearly 8 per cent in its worst day in nearly eight years after the US drug regulator published its warning letter on the drugmaker's manufacturing violations at a plant.
Cipla was the top Nifty loser and also pulled pharma stocks down 1.57 per cent to snap a six-session rally.
IT stocks lost 0.59 per cent. They had gained 6.30 per cent since mid-November when soft US inflation data spurred bets that the Federal Reserve may be done raising interest rates.
On the flip side, two-wheeler maker Hero MotoCorp rose 4.52 per cent, extending its post-earnings rally to the ninth session. It was the top Nifty gainer and drove auto stocks to a fresh record high.
The more domestically focussed small-caps added 0.70 per cent, while mid-caps closed flat.
"The near-term outlook for domestic equities remains positive, but the small- and mid-cap rally seems driven by speculation and on retail inflows," said Samrat Dasgupta, CEO of Esquire Capital Investment Advisors.
Hindustan Petroleum Corp Ltd (HPCL) jumped nearly 7 per cent after Reuters reported that the government planned to ask state-owned Oil and Natural Gas Corp to consider launching a rights issue to help fund HPCL's green projects.
Newly listed Honasa Consumer, the parent of Mamaearth cosmetics, surged 20 per cent after reporting its quarterly profit nearly doubled.