Markets trading near day's low, metal shares crack

Benchmark indices have extended the losses and have reached near day’s low led by weakness among global markets along with selling pressure in Metal, Capital Goods, Banks and Oil shares leading the decline.

By 14:15, Sensex plunged by 274 points at 19,368, and the Nifty down 81 points or 1.37% at 5,862 levels. The Sensex and the Nifty reached an intra-day low of 19,345 levels and 5,861 mark, respectively.

On the global front, most risk assets slid to 2013 lows on Thursday with sentiment rattled by overnight market talk of a hedge fund liquidating big positions in commodities, as well as worries the US Federal Reserve could prematurely wind down its bond buying programme.

European markets are seen following Asia lower, with financial spreadbetters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open down as much as 0.7%. US stock futures were down 0.1% to suggest a weak Wall Street start.

Back home, markets are also jittery as the crucial Budget session of Parliament began today with the United Progressive Alliance government set to face a stiff challenge because of the controversies surrounding the chopper deal.

On the sectoral front, BSE Metal index has slumped by almost 3% followed by counters like Realty, Banks and Capital Goods, all falling down by nearly 2% each. Sectors like Oil & Gas, FMCG, PSU, Auto, Power and Healthcare have declined by 1% each. Infact, all the major BSE sectoral indices are trading in red zone.

Metal shares like Jindal Steel, Tata Steel, Sterlite and Hindalco have melted between 2-4% on news that the commodity prices have declined globally.

According to Mudit Goyal, technical analyst, SMC Global, “Metal stocks can remains under selling pressure in near term. Avoid making long at current levels. Short Hindalco for 100-95 levels, Sesa Goa for 155-150 and Jindal Steel & Power for 330-320 levels.

Financial shares like ICICI Bank, SBI, HDFC Bank and HDFC have slipped between 1-3%. Banks and financial institutions remained closed on the second day of two-day nationwide bandh called by major trade unions to protest against the anti-labour policies of the government.

Capital Goods majors like L&T and BHEL have fallen by 2% each.  

Index heavyweight Reliance Inds lost over 2% on account of profit booking. ONGC declined by 2%.

From the Auto space, Tata Motors, Maruti Suzuki and M&M have slipped between 1-3%.

Other notable losers include CIL, Infosys, ITC and DRL.

The broader indices are underperforming the benchmark indices– BSE Midcap and Smallcap indices are down between 1-2%.

The market breadth in BSE remains unhealthy with 1,873 declining and 794 shares advancing.