Markets fell in opening trades due to losses in commodity related shares and negative global cues. The Nifty fell 36 points, at 5,751 and the Sensex declined 104 points, at 19,163.
Most of the Asian markets were trading in the red on Wednesday morning following weak closing on Wall Street. Selling pressure in high flying energy sector due to falling crude prices and lower than expected revenue posted by Alcoa weighed on the US bourses.
Japan's Nikkei Stock Average gave up early gains and was off 0.1% as resource shares declined, offsetting gains in auto makers. Hong Kong's Hang Seng declined 0.3% also dragged by resource shares as commodity prices fell. South Korea's Kospi Composite was down 0.3% and China's Shanghai Composite slipped 0.6%.
Back in India markets may remain volatile on account of earnings season kick starting this Friday. Analysts expect operating margins of the companies to be lower in the fourth quarter on back of rising interest costs. Brokerages consensus expects the Sensex and S&P CNX Nifty companies to grow 20-30 basis points, slower than previous quarters.
Infosys will announce results on Friday, analysts expect a weak quarter for IT companies due to seasonal factors and also because of IT budgets set last year. Pankaj Kapoor, analyst at Standard Chartered said, "we are looking for 3-3.5% volume growth in 4QFY11. Given that cross currency has been relatively favorable this quarter, realisation growth is pegged between 0.7 to 0.9%."
FIIs turned net sellers in the cash market on Monday for the first time after being net buyers for 14 consecutive sessions. FIIs sold stocks worth Rs 691 crore on Monday after buying shares worth Rs 11,425 crore in the secondary market since March 22nd according to the data compiled by Bombay Stock Exchange.
BSE Realty and Metal shares were leading the losses, the indices were down 1% and 0.8% each. From the realty space, Sunteck Realty dipped 2.9%, Unitech slipped 2.3% and Peninsula Land declined 1.8%. Metal shares were trading lower following weakness in global commodity prices, Sterlite Industries fell 1.4%, Hindustan Zinc declined 1.2% and SAIL was down 1.1%.
Broader markets were also subdued, the midcap and smallcap indices were off 0.2% each.
Market breadth was negative, 821 stocks declined for 641 stocks which advanced.
