Markets recover marginally, but continue in red

The Indian markets recovered some points from the early lows, but continued to trade in the negative zone, with both the bourses down by 0.7% each. Lower Primary Articles' inflation numbers provided some affirmative news in the negative environment, improving investors' confidence in the afternoon trade. The positive opening in the European markets further helped investor sentiment.

The European markets opened on a positive note with marginal gains, after having 2 negative sessions from concerns over the region's debt crisis.

However, Asian markets continued to trade in the red zone over concerns on the slow economic growth of China and Japan. Further, no change in the policy rate by the US Fed worried investors on a significant downside risk to the economy.

Back home, all the BSE sectoral indices continued trading on a negative note. CG, CD and Auto have taken the most beating, and were down by nearly 1.5%-3.7% each. Other indices like IT, Realty, Tech, Metals and Bankex are down by 0.7-1% each.  On the other hand, the Oil & Gas and FMCG indices are up with marginal gains.

Most of the Sensex stocks were in the red tick. BHEL, Hero MotorCorp, Hindalco, M&M, JP Associates and Infosys were all down by 1%-2.5%. Bharti Airtel, Sterlite Industries, SBI and Wipro were beaten down the most, between 2-3% each. Coal India remained the top performer, with gains of more than 2%.

The market breadth, which indicates the overall health of the market, is weak. On the BSE, 1894 shares declined, 607 fell and 118 remained unchanged.

We expect the markets to remain negative for the rest of the day, and advise readers to play cautiously.