Markets trade on a soft note

Broader markets outperform the Sensex

The markets are witnessing soft trades in late noon deals with the Sensex down 52 points at 17,378 after seeing a low of 17,363 earlier in the day. The Nifty lost seven points at 5272.

In the broader markets, the midcap and the smallcap indices gained 0.6% and 0.7%,respectively outperforming the Sensex down 0.3%.

On the macro front, India's factories in June stepped up production and hired workers at the fastest rate in more than two years, but sagging demand abroad took a toll on growth in new export orders, a survey showed on Monday. The HSBC manufacturing Purchasing Managers' Index (PMI) rose to 55.0 in June, a four-month high, from 54.8 in May. It has kept above the 50 mark that divides growth and contraction for more than three years.

Meanwhile, India's exports fell 4.16 percent year-on-year to $25.68 billion in May, while imports fell 7.36 percent year-on-year to $41.9 billion, government data showed on Monday. May's trade deficit was $16.3 billion.

In Asia, Japan's Nikkei average erased earlier gains to end almost flat on Monday after an early rally spurred by an agreement to stabilize euro zone banks sputtered out as investors waited for more details. The Nikkei ended at 9,003.48, almost unchanged, after having hit two-month high of 9,103.79 at one point.

Back home, among the sectoral indices, Realty and Consumer Durables were the top gainers, up 1% each followed by Healthcare, Power and Capital Goods, up marginally. On the other hand, Auto and Oil & Gas indices, down 1% each were the major draggers.

Auto index slipped on mixed June sales figures. Country's second largest two-wheeler maker Bajaj Auto reported a 1.38% decrease in its motorcycle sales in June at 318,377 units on a y-o-y basis. However, Maruti Suzuki India reported a 20% y-o-y jump in its total sales in June 2012, on back of robust sales growth in Swift, Estillo, Ritz and DZire.

The top gainers among the Sensex stocks were Maruti Suzuki, Gail India, BHEL, HDFC Bank, Bharti Airtel, up nearly 1%.

Jindal Steel, Hero MotoCorp, ICICI Bank, ONGC, Tata Motors, down 1-3%, were the major losers.

Among other stocks, Hindustan Construction Company (HCC) is trading higher by 3% at Rs 21.05, extending its Friday’s around 5% rally, after the company said that its board has approved debt restructuring. “The board of directors of the company at its meeting held on June 29, 2012, have approved the restructuring of company's debts as per the Corporate Debt Restructuring Letter of Approval (CDR LOA) received pursuant to the restructuring package approved by the CDR Empowered Group at its meeting dated June 25, 2012,” HCC said in a filing.

Pratibha Industries has rallied 6% to Rs 49.30, after the company said that it has secured orders worth of Rs 1,492 crore in tunneling and building division. “The tunneling division of the company bagged a contract amounting of Rs 1,090 crore from DMRC. It involves design and construction of tunnel between Motibagh and Lajpat Nagar stations of Delhi MRTS projects of Phase III,” Pratibha Industries said in a filing.

The market breadth was very positive owing to strong broader markets. 1549 stocks advanced while 978 stocks declined on the BSE.