Markets Tank Further As Europe Opens Negative

The Indian markets continue to remain weak, with both the benchmark indices going down by over 0.5%. The markets have widened their morning losses and those in the week as well.

The Asian markets have reflected a mixed sentiment, with Hang Seng and Shanghai showing a decline while Nikkei has gained by 0.4%.

The European markets have opened in the red, which has sent negative signals to the Indian indices. FTSE has declined by 0.4%, while CAC and DAX too are down by 0.2% and 0.1% respectively. The ECB president Mario Draghi has cancelled his proposed speech in the US, and there is spurt in all sorts of speculations on the outcome of the ECB meet due next Friday.

The sentiment is quite bearish, and most of the indices are facing the heat. At the moment, only the defensive sectors i.e. HC and FMCG are trading positive, while all the others are in the red. Auto, Metals, Realty and Oil & Gas are the worst performers, down by over 1% each. Media reports have said that the growth in the Realty market is currently at a 6-year low, which has dragged the index down.

Among the Sensex stocks, Tata Power is up 2.6% and Jindal Steel is seeing 1.53% gains. IT stocks Wipro and TCS are witnessing moderate buying, and the shares of both the companies are up 0.5%. On the downside, a total 21 of the 30 index stocks have declined. Sterlite and Bajaj Auto are facing the heat and have fallen by more than 4% each. BHEL, ONGC, Hero, Hindalco, Infy and Tata Motors are also seeing their equities declining by over 1%.

In other stocks, the shares of Strides Arcolab are up 1.5% as the company has said that it has received another USFDA approval.

The advance-decline ratio on the BSE has further worsened, as there are more declines than advances.

We believe that the markets are set to close in negative for the third straight day in the week ahead of the expiry of the August derivatives series tomorrow.