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Market declines further

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Capital Market
Last Updated : May 21 2018 | 3:04 PM IST

After a staging a brief recovery, the market slipped once again and hit fresh intraday low in mid-afternoon trade. At 14:23 IST, the barometer index, the S&P BSE Sensex, was down 190.53 points or 0.55% at 34,657.77. The Nifty 50 index was down 73.50 points or 0.69% at 10,522.90.

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 and hit fresh intraday low in mid-afternoon trade.

The Sensex rose 125.65 points, or 0.36% at the day's high of 34,973.95 in morning trade. The index fell 223.04 points, or 0.64% at the day's low of 34,625.26 in mid-afternoon trade, its lowest intraday level since 26 April 2018. The Nifty rose 25.30 points, or 0.24% at the day's high of 10,621.70 in morning trade. The index fell 80 points, or 0.75% at the day's low of 10,516.40 in mid-afternoon trade, its lowest intraday level since 23 April 2018.

Broader market witnessed selling pressure. Among secondary barometers, the BSE Mid-Cap index was down 1.47%. The BSE Small-Cap index was down 2.16%. Both these indices underperformed the Sensex.

The market breadth, indicating the overall health of the market, was weak. On BSE, 601 shares rose and 1967 shares fell. A total of 119 shares were unchanged.

Most capital goods shares declined. BEML (down 7.24%), Reliance Defence and Engineering (down 5.19%), Punj Lloyd (down 4.13%), Jindal Saw (down 3.62%), Praj Industries (down 3.01%), Lakshmi Machine Works (down 2.91%), GE T&D India (down 2.14%), GE Power India (down 2.1%), Bharat Electronics (down 1.89%), Suzlon Energy (down 1.58%), SKF India (down 1.52%), Bharat Heavy Electricals (down 1.37%), Crompton Greaves (down 1.16%), AIA Engineering (down 0.79%), ABB India (down 0.6%) and Siemens (down 0.28%), edged lower. Thermax (up 0.48%) and Havells India (up 0.66%), edged higher.

Engineering & construction major L&T was up 0.08% to Rs 1,317.10.

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Most power generation stocks declined. JSW Energy (down 3.05%), Adani Power (down 2.36%), Torrent Power (down 2.2%), GMR Infrastructure (down 2.01%), NTPC (down 2.01%), Tata Power (down 1.8%), Jaiprakash Power Ventures (down 1.66%), Reliance Power (down 1.63%) and CESC (down 1.62%), edged lower. Reliance Infrastructure (up 0.23%) and NHPC (up 0.57%), edged higher.

State-run Coal India was up 1.09%. State-run Power Grid Corporation of India was up 0.16%.

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.

BJP national president Amit Shah is reportedly expected to hold a press conference at 16:00 IST at the party headquarters in Delhi.

Overseas, most European and Asian shares rose as investors welcomed weekend news of an agreement between the US 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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First Published: May 21 2018 | 2:23 PM IST

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