Global Cues Weighs Heavy on the Markets

The Global Markets trade in a negative territory this morning. U.S. stocks slumped, sending benchmark indexes to their biggest declines in a month, after Standard & Poor’s Ratings Service cut the nations long-term credit outlook to negative. European stocks dropped the most in three weeks as Standard & Poor’s Ratings Service revised its credit outlook for the U.S. to negative and speculation escalated that Greece needs to restructure its debt. This morning Asian stocks fell, leading the benchmark index toward its biggest decline since March 15, after Standard & Poor’s Ratings Service cut the U.S. long-term credit outlook, fueling concern that a recovery in the global economy may slow. In commodities, Oil traded near a three-day low in New York as signs of a worsening economic outlook in the U.S. and Europe stoked speculation fuel demand may falter. Gold may advance to a record for a fourth day, topping $1,500 an ounce, as Standard & Poor’s downgrade of the U.S. credit outlook, Europe’s debt crisis and rising inflation bolstered the appeal of precious metals. Copper fell for a sixth day in New York, the longest streak since June, after Standard & Poor’s put a “negative” outlook on the AAA credit rating for the U.S., the second-largest consumer of the metal. Markets opened flat following weakness in the global markets after Standard & Poor’s downgraded the US growth outlook. Banking shares were leading the gains while realty and auto shares weighed. The Nifty was down 28 points, at 5701 and the Sensex dipped 101 points, at 18,989.Realty shares were leading the losses, the index was down 0.6%. Indiabulls Real Estate was off 1.5%, Parsvnath Developers slid 1.3% and DB Realty fell 1.3%. Banking shares were leading the gains, the BSE Bankex index was up 0.6%. IDBI Bank surged 2.4%, HDFC Bank surged 1.4% and Indusind Bank was up 1%. Top gainers on the Sensex were HDFC Bank, up 1.3%, TCS advanced 1% and Reliance Communication gained 0.6%. The top losers were Hero Honda, down 1.4%, ONGC dipped 1.3% and ITC was off 1.3%. The midcap and small cap indices were up 0.3% each. Market breadth was marginally positive 879 stocks advanced for 860 stocks which declined.