MUMBAI: The BSE Sensex turned negative after opening higher on Tuesday as investors booked profits on blue-chips, although traders said expectations of an economic stimulus package and an interest rate cut soon still held firm.
At 11:10 a.m., the 30-share main BSE index was down 0.4 percent, at 9,496.71 points.
Earlier, the Sensex opened 0.96 percent up, mirroring a rise in other Asian markets.
Shares in India's No. 4 software exporter Satyam Computer Services were up nearly 6 percent.
Three directors resigned from its board at the start of the week but the firm has also said it would consider more options to improve shareholder value and corporate governance.
"The mood seems to be a bit upbeat in the short-term and the expectation of an economic package is growing now," said Arun Kejriwal, a strategist with research firm KRIS. "But the fact that we are at year end, trade volumes will be lower."
Montek Singh Ahluwalia, the deputy head of the Planning Commission, said lower inflation and slowing economic growth have created scope for further easing in monetary policy.
The main 30-share BSE index rose 2.19 percent on Monday to 9,533.52, snapping a four-day slide.
Foreign funds have been net sellers of more than $13.3 billion of Indian stocks in 2008, after investing a record $17.4 billion last year when the BSE index rose 47.15 percent.
By 0330 GMT, Japan's Nikkei was up 1.3 percent, Hong Kong was up 0.5 percent and Sydney was trading 0.6 percent higher. The Nifty futures traded in Singapore was up 0.8 percent.
STOCKS TO WATCH
* Banking stocks such as Bank of India, State Bank of India on growing expectations of deep interest rate cuts.
* Electrotherm India after the firm said its board has approved spinning off its engineering business into a new entity - Electrotherm Engineering & Projects Ltd.
* Rolta India after the software services firm said it has acquired U.S.-based Piocon Technologies, which provides solutions to oil and gas refineries.
