Key benchmark indices ended the trading session on a weak note with the BSE Sensex having ended (provisional) down 282 points at 17,355 and the Nifty at 5,280, down 79 points.
BSE Realty, Metal, Bankex and Capital Goods indices led the losses, down 3% each.
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(updated at 1437 hours)
The markets continued to trade weak in afternoon trades on the back of widespread selling pressure visible across the sectors. The BSE Sensex has slipped 277 points to 17,359 and the S&P CNX Nifty is down 79 points at 5,280.
In Asia, Japan's Nikkei share average dropped on Monday as profit-taking from domestic investors mounted near key chart levels and as Asian shares slipped on disappointment after China announced its lowest annual growth target in eight years. The benchmark Nikkei fell 0.8% to 9,699, slipping from Friday's seven-month closing high of 9,777
while the broader Topix index shed 0.6% to 833. The Hang Seng and Shanghai Composite indices ended lower by 1% each.
Further, European markets are lower today with shares in Germany off the most. The DAX is down 0.66% while France's CAC 40 is off 0.40% and London's FTSE 100 is lower by 0.23%.
Back home, according to Hormuz Maloo, Technical Analyst, Geojit BNP Paribas Securities, "In the medium term, the markets will move lower. However, currently we seem to be moving sideways after the steep fall witnessed on Feburary 27. There is no clear short-term trend evident on the charts, though the bias seems to be on the downside. I think it might be best to await a clear signal before taking a position for the short term."
Shares of metal companies are under pressure and trading lower on reports that the China, the world's largest consumer of copper and aluminum, scaled down its GDP growth target to 7.5% this year from last year's 8%. This is the first time for the Chinese government to lower its economic growth target after keeping it around 8% for seven consecutive years.
“Facing an economic down turn due to steady fall in exports, China for the first time in seven years projected a lower growth, scaling down its GDP growth target to 7.5% this year from last year's 8%,” PTI report suggests.
The Bombay Stock Exchange (BSE), metal index, is the largest loser among the sectoral indices, down 311 points or 2.6%, at 11,658.
Among the individual stocks, Jindal Steel and Power, Hindalco Industries, Hindustan Zinc and JSW Steel have plunged 3-5% each, while Tata Steel, SAIL and Sterlite Industries are down by 3% on the BSE.
BSE Bankex has shed 2% at 11,772. The prominent losers from the space are Canara Bank, Bank of India, ICICI Bank ans SBI, down 3-4% each.
Meanwhile, Reserve Bank of India (RBI) Deputy Governor Subir Gokarn said in an interview to a TV channel that there is still room for the RBI to cut the cash reserve ratio (CRR) for banks. "When the space opened up for CRR cut, we used it," he said. "That space still exists, and so if we think it is appropriate we will use it."
The RBI cut the CRR, or the proportion of deposits that banks must maintain with the central bank, by 50 basis points to 5.5% on January 24 but kept its key policy rate unchanged.
On the Sensex, Jindal Steel has shed 5% at Rs 564. Other prominent losers include Hindalco Industries, DLF, GAIL and BHEL, down 4-5% each.
The gainers from the pack are Tata Motors, Bharti Airtel, ITC, ONGC and Cipla, up 1-2% each.
The overall market breadth is negative as 1,766 stocks have declined against 945 advancing ones, on the BSE.
