Data showing slowdown in India's economic growth and weakness in global stocks hit sentiment on the domestic bourses adversely as the key benchmark indices extended losses in early afternoon trade. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit their lowest level in almost a week. The Sensex was currently hovering below the psychological 26,000 level. Earlier, the Sensex regained the psychological 26,000 level after falling below that level in early trade. The Sensex was currently off 324.71 points or 1.24% at 25,958.38.
The broad market depicted weakness. There were more than three losers against every gainer on BSE. The BSE Mid-Cap index was off 1.2%.
Capital goods stocks edged lower. Index heavyweight and engineering and construction major L&T fell in volatile trade after the company won a major railway order worth Rs 1070 crore in Saudi Arabia. Telecom stocks dropped.
Data showing slowdown in growth in India's gross domestic product (GDP) growth to 7% in Q1 June 2015 from 7.5% in Q4 March 2015 weighed on investor sentiment.
In overseas markets, Asian stocks edged lower after twin surveys showed China's manufacturing sector in the grip of its worst slump in several years, raising fresh fears about the health of its economy. US stocks declined yesterday, 31 August 2015, reflecting continuing concerns about the Chinese economy and uncertainty over US interest rates.
At 12:14 IST, the S&P BSE Sensex was down 324.71 points or 1.24% at 25,958.38. The index lost 339.94 points at the day's low of 25,943.15 in early afternoon trade, its lowest level since 26 August 2015. The index fell 142.02 points at the day's high of 26,141.07 at the onset of the trading session.
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The CNX Nifty was down 107.05 points or 1.34% at 7,864.25. The index hit a high of 7,929.10 in intraday trade. The index hit a low of 7,858.25 in intraday trade, its lowest level since 26 August 2015.
The market breadth indicating the overall health of the market was quite weak. There were more than three losers against every gainer on BSE. 1,737 shares declined and 563 shares rose. A total of 80 shares were unchanged.
The BSE Mid-Cap index was off 128.98 points or 1.2% at 10,605.44. The BSE Small-Cap index was off 104.36 points or 0.95% at 10,866.91. The fall in both these indices was lower than the Sensex's decline in percentage terms.
The total turnover on BSE amounted to Rs 1023 crore by 12:15 IST compared with turnover of Rs 778 crore by 11:15 IST.
Capital goods stocks edged lower. BEML (down 1.48%), Bharat Electronics (down 2.06%), Crompton Greaves (down 1.45%), Siemens (down 2.39%), ABB India (down 0.48%), Bharat Heavy Electricals (Bhel) (down 0.13%) and Thermax (down 0.71%) declined.
Index heavyweight and engineering and construction major L&T fell 2.09% to Rs 1,571.80. The stock hit high of Rs 1,588 and low of Rs 1,562.50 so far during the day. L&T during market hours today, 1 September 2015, announced that it has won a major railway order worth Rs 1070 crore in Saudi Arabia.
Telecom stocks dropped. Bharti Airtel (down 2.54%), Idea Cellular (down 3.05%), MTNL (down 1.28%), Tata Teleservices (Maharashtra) (down 0.62%) and Reliance Communications (down 2.07%) fell.
On the macro front, India's gross domestic product (GDP) growth at constant (2011-12) prices slowed down to 7% in Q1 June 2015 from 7.5% growth recorded in Q4 March 2015, government data released after market hours yesterday, 31 August 2015 showed. Quarterly gross value added (GVA) at Basic Price at constant (2011-2012) prices exhibited recovery in growth to 7.1% in Q1 June 2015 from 6.1% growth recorded in Q4 March 2015.
Another data released by government after market hours yesterday, 31 August 2015 showed that the Eight Core Industries, carrying 38% weight in the Index of Industrial Production (IIP), recorded 1.1% growth in July 2015, showing moderation from 3% growth recorded in the previous month. Its cumulative growth during April to July, 2015-16 was 2.1%.
Meanwhile, the outcome of a monthly survey showed slowdown in growth in India' manufacturing sector last month. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers' Index (PMI) fell to 52.3 in August 2015 from July's six-month high reading of 52.7. A reading above 50 indicates an expansion in manufacturing activity, while a reading below 50 indicates a contraction.
In overseas markets, Asian stocks edged lower today, 1 September 2015, after activity in China's manufacturing sector slowed markedly in August, twin surveys showed today, 1 September 2015, the latest sign that the world's second largest economy is fast losing momentum. Key benchmark indices in Singapore, Taiwan, Japan, Indonesia and South Korea fell by 0.42% to 3.84%. In mainland China, the Shanghai Composite was off 1.41%. In Hong Kong, the Hang Seng index was off 0.76%.
Trading in US index futures indicated that the Dow could slide 238 points at the opening bell today, 1 September 2015. There is uncertainty in global markets as to the timing of the first interest rate hike in a decade from the US Federal Reserve.
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