Markets Swerve Into Negatives

The Indian markets have erased their morning gains and have turned into the red at this hour. The rupee, which had strengthened in the previous few days, has shown some negative trades.

The Asian indices have also declined from their morning gains. Nikkei has continued to trade in the green but has curbed its gains. Hang Seng and Shanghai have turned red as China’s services industry activity declined from 51.9 in May 2012 to a three-month low of 50.6 in Jun 2012. China has already recorded a decline in its manufacturing data, indicating a slowdown in that segment as well. In the last month, it has effected a cut in interest rates to revive growth in the economy.

European indices have opened negative ahead of the European Central Bank's meet. All eyes are set on the ECB and the Bank of England, which will hold monetary policy meetings on Thursday, Jul 5, 2012.

Meanwhile, the Deputy Governor of the RBI has said the central banker will step up appropriate actions as and when needed. It is watching the progress of the monsoon, which currently seems normal. He also is satisfied with the current liquidity conditions in the country after the initial CRR cut and OMOs.

On the domestic front, Metals are still shining but have come down from their day's high. The interest-rate sensitive sectors like Auto, Realty and Bankex are showing marginally positive trades. The CD index is flat to positive. All the others are in the red, with IT being the top loser.

Among the Sensex stocks, Jindal Steel is up by 3.89%. Sterlite is also holding its gains. Maruti is trading up by 2% and Tata Steel, SBI, Bajaj Auto, Bharti and Hindalco are up by over 1% each. ONGC has continued to trade negative. Wipro, Dr. Reddy's Labs, NTPC, HUL, ITC and RIL are all down.

The overall health of the market is still positive, as the advance-decline ratio is favourable.