Markets Trading Lower

As expected in our morning update, the Indian markets opened in the negative territory in line with global cues, as the US and European markets tanked heavily overnight. At present, both the indices are trading lower, with the Sensex down by 111 points to 17130 and Nifty down by 36 points to 5207. Yesterday, the markets had seen some buying, which helped the broader indices to close on a positive note. Among the sectors, Metals, Oil & Gas, Bankex, Capital Goods and Consumer Durables are trading lower by more than 1%, while Healthcare is the only sector that is trading marginally in the positive zone.

Other Asian markets too are trading on a weaker note, with Hang Seng and Nikkei down by more than 1% each, while Shanghai is trading marginally in the red zone. The Asian markets are looking weak after Consumer Durable major, Sony Corp, posted a record loss and following the surge in the bond yield of Italy and Spain, which resulted in speculations that the European debt crisis is worsening, impacting the world’s growth prospects.

Back home, the Metals pack are showing a lacklustre performance and the scrips are among the leading index losers. Sterlite Industries and Jindal Steel are trading lower by 2.35% and 1.98% respectively. Banking majors HDFC Bank, ICICI Bank and SBI are trading lower in the range of 1.19%-1.24% on the back of speculations that the RBI might not cut the rates in its monetary policy scheduled next week. Other stocks like Hindalco, Maruti Suzuki, NTPC, HDFC, etc. are trading marginally in the red zone. Only four stocks are trading higher. Auto majors Mahindra & Mahindra and Tata Motors are trading lower by 0.76% and 0.56% respectively. Other stocks like Cipla and Infosys are trading marginally in the green zone.

Man Infraconstruction is trading lower by 1.05% at Rs 197.35 despite having bagged orders worth Rs 62 crore. Indraprastha Gas has witnessed some buying and is trading up 2.83% to Rs 236.10 after being beaten down in the past couple of trading sessions. The stock is looking nervous after the Petroleum and Natural Gas Regulatory Board (PNGRB) directed the company to refund the excess tariff.

The market breadth, which indicates the overall health of the market, is weak. On the BSE, 1014 shares declined and 787 shares rose. 82 shares remained unchanged.

We expect the markets to remain volatile for the day.