Markets remain lower led by auto shares

Markets continue to remain weak in afternoon trades on Thursday as investors booked profits in auto, financials and capital goods shares.

By 1300 hrs, the Sensex was at 19,942 down 85 points whereas the Nifty slipped 29 points at 6,026 levels. The Sensex and the Nifty touched an intraday low of 19,884 mark and 6,041 levels, respectively.

On the global front, Asian shares fell on Thursday in choppy trade, as positive Chinese manufacturing data was eclipsed by North Korea threatening a nuclear test and on below-view results from Apple Inc.

European markets are seen easing, with financial spread-betters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open down as much as 0.1%. US stock futures were down 0.3%, pointing to a softer Wall Street start.

Back home, BSE Auto index is down nearly 3% followed by counters like Realty, Capital Goods, Power, Healthcare, Metal and PSU, all slipping between 1-2%. However, BSE FMCG and IT indices are up by nearly 1% each.

From the Auto space, Tata Motors is the top Sensex loser, down almost 7%. Maruti Suzuki, Bajaj Auto and Hero Moto have declined between 1-2%.

Explains Amar Ambani, head of research, IIFL, “Auto numbers (volumes) have been disappointing across segments – two wheelers, passenger vehicles etc. There has been a de-growth, be it Bajaj Auto, Hero MotoCorp. Even the tractor volumes have been bad. The only saving grace for commercial vehicles (CVs) was the light commercial vehicle (LCV) segment. On top of this, there is intense competition amongst the players in this segment. So, the entire auto industry is struggling.”

Other losers include GAIL, Cipla, Hindalco, Sterlite, Bharti Airtel, L&T and Tata Power.

Shares of airlines were down over 1% each after the Supreme Court ruled that air travellers should not pay transaction fee and that the aviation regulator should review the wide variation in air fares by airlines.

The Supreme Court directed the Directorate General of Civil Aviation to review 'fare bands' issued by airlines to make pricing more transparent for air travellers. The court also ruled that passengers should not pay a transaction fee till the civil aviation secretary takes a decision on the matter, according to a Economic Times report.

Jet Airways was down 1.1% at Rs 592.60, SpiceJet was down 3.1% at Rs 44.70 and Kingfisher Airlines was down 1.5% at Rs 13.65.

The market breadth in BSE remains dismal with 1,906 shares declining and 679 shares advancing.