Key benchmarks were trading with modest losses in mid afternoon trade. The Nifty struggled to regain the 11,300 mark. At 14:28 IST, the barometer index, the S&P BSE Sensex, was down 152.8 points or 0.4% at 37,829.15. The Nifty 50 index was down 67.7 points or 0.6% at 11,263.95.
The S&P BSE Mid-Cap index was down 1.59%. The S&P BSE Small-Cap index was down 1.03%. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 767 shares rose and 1547 shares fell. A total of 158 shares were unchanged.
FMCG stocks were trading lower. Bajaj Consumer Care (down 5.13%) Britannia Industries (down 3.32%), Dabur India (down 1.78%), Marico (down 1.04%), Godrej Consumer Products (down 1.02%), Colgate Palmolive (India) (down 0.8%), ITC (down 0.17%) and Jyothy Laboratories (down 0.09%) declined. GlaxoSmithkline Consumer Healthcare (up 1.19%), Nestle India (up 0.89%) Procter & Gamble Hygiene & Health Care (up 0.75%) and Tata Global Beverages (up 0.12%) edged higher.
Hindustan Unilever was up 1.21% to Rs 1713.45 after the company's consolidate net profit rose 11.27% to Rs 1,787.23 crore on 6.04% increase in net sales to Rs 10197 crore in Q1 June 2019 over Q1 June 2018. The company said that domestic consumer growth was 7% with underlying volume growth at 5%. It reported a EBITDA improvement of 250 bps with a reported EBITDA growth of 18%. Margin expansion was driven by improved mix, leverage in operating and advertising spends and the firm's savings agenda. Earnings before interest, tax, depreciation and amortization (EBITDA) at Rs 2647 crore was up by 18% (13% on comparable basis after adjusting for accounting impact of IndAS 116).
Crompton Greaves Consumer Electricals was up 0.96% to Rs 230.7 after company's consolidated net profit increased 17.4% to Rs 122.44 crore on 11.8% increase in net sales to Rs 1346.84 crore in Q1 June 2019 over Q1 June 2018.
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Bosch was down 2.63% to Rs 14623.8. The company announced that it has proposed to suspend all its manufacturing operations at the company's Naganathapura (Karnataka) plant for two days from 27 to 29 July 2019.
The yield on 10-year benchmark federal paper fell to 6.44% at 14:15 IST compared with 6.464% at close in the previous trading session.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 68.99, compared with its close of 68.9475 during the previous trading session.
Crude prices edged higher as rising tensions with Iran fuelled concerns about supply disruptions and as U.S. inventory data showed a much bigger than expected drop in crude stockpiles. In the commodities market, Brent crude for September 2019 settlement was up 24 cents at $64.07 a barrel. The contract rose 57 cents or 0.9% to settle at $63.83 a barrel in the previous trading session.
MCX Gold futures for 5 August 2019 settlement fell 0.03% at Rs 35,009.
Overseas, most European markets were trading lower. Asian stocks closed on a mixed note on Wednesday following developments on the U.S.-China trade front. Market focus is largely attuned to global central banks, amid expectations that the ECB and the Federal Reserve could soon cut interest rates. The ECB is seen cutting rates by 10 basis points on Thursday, with the U.S. central bank expected to lower rates by 25 basis points at the end of the month.
In Europe, Boris Johnson was named the new British prime minister and his tenure, set to begin on Wednesday will have a huge impact across global markets and the geopolitical landscape. All eyes will be on his Brexit strategy and the composition of his cabinet.
US stocks closed higher Tuesday on upbeat quarterly reports from Coca-Cola and United Technologies and on optimism the United States would resolve its trade conflict with China.
Talks between China and the U.S. would start Monday as U.S. negotiators headed to China, as per reports. The U.S. delegation will be led by Trade Representative Robert Lighthizer and will be in China through Wednesday. The world's two largest economies have been locked in a trade war that has seen 25% tariffs imposed by President Donald Trump on $200 billion of Chinese products. China has retaliated with their own tariffs prompting fears of a global economic slowdown.
The International Monetary Fund (IMF) said in its World Economic Outlook report that the global economy is expected to expand by 3.2% in 2019, down 0.1 percentage points from its April forecast and 0.3 percentage points below the estimate at the start of the year. The IMF cited concerns about the ongoing U.S.-China trade war and noted that global technology supply chains were threatened by the prospect of U.S. sanctions, Brexit-related uncertainty continued, and rising geopolitical tensions roiled energy prices.
Meanwhile, the IMF also projected a slower growth rate for India in 2019 and 2020, a downward revision of 0.3% for both the years, saying its GDP will now grow respectively at the rate of 7 and 7.2% reflecting a weaker-than-expected outlook for domestic demand.
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