Weakness in European stocks triggered weakness on the domestic bourses, with the two key benchmark indices reversing gains in afternoon trade. At 13:16 IST, the barometer index, the S&P BSE Sensex, was down 132.55 points or 0.52% at 25,304.42. The losses for the Nifty 50 index were higher in percentage terms than those for the Sensex. The Nifty 50 index was currently down 45.60 points or 0.58% at 7,760.30. The Sensex and the Nifty, both, hit 3-week low.
The Sensex fell 155.86 points or 0.61% at the day's low of 25,281.11 in afternoon trade, its lowest level since 12 April 2016. The barometer index rose 268.99 points or 1.05% at the day's high of 25,705.96 in early trade, its highest level since 29 April 2016. The Nifty fell 46.50 points or 0.60% at the day's low of 7,759.40 in afternoon trade, its lowest level since 12 April 2016. The index rose 84.35 points or 1.08% at the day's high of 7,890.25 in early trade, its highest level since 28 April 2016.
The market breadth indicating the overall health of the market was positive. On BSE, 1,213 shares rose and 1,180 shares declined. A total of 163 shares were unchanged. The BSE Mid-Cap index was currently down 0.46%. The decline in this index was lower than the Sensex's decline in percentage terms. The BSE Small-Cap index was currently up 0.25%, outperforming the Sensex.
In overseas stock markets, European shares were mostly lower in early trade today, 3 May 2016, with Commerzbank leading the market lower after a profit slump, while mining stocks weakened as they tracked a decline in metals prices. Asian stocks witnessed a mixed trend. Chinese stocks saw a divergent trend after the latest data showed deceleration in China's manufacturing activity in April 2016. In mainland China, the Shanghai Composite ended 1.85% higher. In Hong Kong, the Hang Seng index was currently down 1.18%. The Caixin China general manufacturing purchasing managers' index fell to 49.4 in April 2016 from 49.7 in March 2016. A reading below 50 indicates economic contraction. China's official manufacturing PMI, a competing gauge, came in at 50.1 in April 2016 compared with 50.2 in March 2016, according to data released by the National Bureau of Statistics on 1 May 2016. Meanwhile, Chinese leaders have called for strengthening the supervision of stock market and protecting investor interests, according to reports.
US stocks closed higher yesterday, 2 May 2016, after data showed slow-but-steady economic growth unfolding in the US. Latest data from the Institute for Supply Management showed manufacturing index in US fell to 50.8 last month from 51.8 in March. The reading, coming in above 50, indicates expansion in manufacturing activity, albeit at a slower-than-expected pace. Meanwhile, the San Francisco Federal Reserve President John Williams reiterated yesterday, 2 May 2016, his view that the US economy is ready for higher interest rates, but flagged the risk of broad-based declines in asset prices as a result.
Aurobindo Pharma surged 4.6% at Rs 805.10 on reports that a foreign brokerage has initiated coverage on the Aurobindo Pharma stock with an "Outperform" rating. The brokerage has reportedly said in a research report that Aurobindo Pharma is a beneficiary of faster approvals for its drugs in the US. It added that all key plants of the company are compliant with the US Food and Drug Administration (USFDA) norms. The brokerage expects Aurobindo's US sales to rise at a CAGR of 20% over next two years. The US market contributes 80% to Aurobindo's profits, according to the brokerage.
Most telecom stocks edged higher. Bharti Airtel (up 2.22%), Reliance Communications (up 0.53%) and Idea Cellular (up 0.17%), edged higher. MTNL (down 1.59%) and Tata Teleservices (Maharashtra) (down 1.62%), edged lower.
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Shares of telecom towers company Bharti Infratel were up 1.77% at Rs 382.75.
Most realty shares edged higher. Anant Raj (up 9.32%), Unitech (up 3.38%), Parsvnath Developers (up 3.25%), Indiabulls Real Estate (up 2.66%), Sobha (up 1.73%), D B Realty (up 1.61%), Housing Development and Infrastructure (HDIL) (up 1.44%), Mahindra Lifespace Developers (up 1.36%), Oberoi Realty (up 0.70%), Sunteck Realty (up 0.54%) and DLF (up 0.51%), edged higher. Godrej Properties (down 0.19%), Prestige Estates Projects (down 0.79%), Phoenix Mills (down 1.29%) and Peninsula Land (down 1.67%), edged lower.
On the macro front, data released by the government after market hours yesterday, 2 May 2016, showed that the core sector registered a strong growth of 6.4% in March 2016 over March 2015. The eight core industries comprising of coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity have nearly 38% weightage in the index of industrial production (IIP). The core sector registered a growth of 2.7% in the year ended 31 March 2016 over the year ended 31 March 2015.
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