Key benchmarks extended losses and hit fresh intraday low in afternoon trade led by index pivotals HDFC, HDFC Bank and Reliance Industries. At 13:16 IST, the barometer index, the S&P BSE Sensex, was down 164.94 points or 0.47% at 34,683.36. The Nifty 50 index was down 62.55 points or 0.59% at 10,533.85. Auto stocks declined. Realty stocks dropped.
After starting on a weak note, the market bounced back for a brief period in morning trade. Gains were unable to sustain at higher levels and the indices slipped into negative terrain in morning trade. Indices slipped further in early afternoon trade.
Broader market witnessed selling pressure. Among secondary barometers, the BSE Mid-Cap index was down 1.4%. The BSE Small-Cap index was down 2.09%. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market, was weak. On BSE, 584 shares rose and 1,908 shares fell. A total of 104 shares were unchanged.
Index heavyweight Reliance Industries fell 0.97% to Rs 924.30.
Index heavyweight HDFC declined 1.46% to Rs 1830.05
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Auto stocks declined. Ashok Leyland (down 7.45%), Tata Motors (down 1.95%), Maruti Suzuki India (down 1.2%), Eicher Motors (down 0.61%), Bajaj Auto (down 0.63%), Hero MotoCorp (down 1.57%) and TVS Motor Company (down 2.53%) declined. Mahindra & Mahindra (M&M) (up 0.79%) and Escorts (up 1.47%) rose.
Realty stocks dropped. Housing Development and Infrastructure (down 7.6%), D B Realty (down 5.68%), Unitech (down 3.91%), DLF (down 0.84%), Sobha (down 3.15%), Godrej Properties (down 3%) and Prestige Estates Projects (down 1.44%) fell. Oberoi Realty (up 0.67%) rose.
Indiabulls Real Estate was down 6.3%. The company said that the board of directors of the company has, at its meeting held on 18 May 2018, has approved the proposal of buy-back of up to 2.6 crore fully paid-up equity shares of Rs 2 each of the company, being approx. 5.45% of existing paid-up share capital of the company, at prevailing market price on stock exchanges subject to a price not exceeding Rs 240 per equity share, aggregating up to an amount not exceeding Rs 624 crore, being less than 10% of total paid-up share capital and free reserves of the company from the open market through the stock exchange mechanism. The announcement was made after market hours on Friday, 18 May 2018.
On the political front, the much-awaited Karnataka floor test ended in an anti-climax of sorts with BS Yeddyurappa, who took oath as the Chief Minister on Thursday, 17 May 2018, resigned on Saturday, 19 May 2018, after he failed to secure the magic number of 112 required to form the government. Janata Dal (Secular) leader HD Kumaraswamy will now be sworn in as Chief Minister on Wednesday, 23 May 2018.
HD Kumaraswamy will reportedly be meeting former Congress president Sonia Gandhi and Congress president Rahul Gandhi in Delhi today, 21 May 2018, to discuss the modalities of government formation.
Overseas, European equities rose slightly in early trading while most Asian shares rose as investors welcomed weekend news of an agreement between the U.S. and China that could reduce the American trade deficit with the world's No. 2 economy.
The US trade war with China is on hold after the world's largest economies agreed to drop their tariff threats while they work on a wider trade agreement, US Treasury Secretary Steven Mnuchin reportedly said on Sunday. Mnuchin and US President Donald Trump's top economic adviser, Larry Kudlow, said the agreement reached by Chinese and American negotiators on Saturday set up a framework for addressing trade imbalances in the future, reports added.
US stocks closed mostly lower on Friday, 18 May 2018, as investors grappled with lingering uncertainty over trade negotiations between the US and China, as well as bond yields that climbed this week to the highest level since 2011.
A focus for global markets this week is Wednesday's release of minutes from the Federal Reserve's latest monetary policy meeting. Investors will be watching the minutes for clues about the pace of the current tightening cycle.
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