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After a rangebound session, markets ended the session lower tracking weakness in the European peers as the mood remained skittish after hopes of a last minute deal between Athens and the euro zone dampened. Meanwhile, weakness in Indexheavyweights including Tata Motors and Infosys weighed on the bourses.
Provisionally, the sesex closed 85 points lower at 27,936 levels and the Nifty dropped 11 points to end at 8,442.
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(updated at 2:40 PM)After a rangebound session, markets have slipped in the negative territory owing to weakness in the Index heavyweights amid weakness in the European peers. Meanwhile, the mood remained skittish after hopes of a last minute deal between Athens and the euro zone dampened.
At 3:17 PM, the sesex was down 88 points at 27,933 levels and the Nifty dropped 12 points at 8,441.
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(updated at 2:40 PM)Markets pared gains and are trading with marginal losses, amid weak European cues, as investors turned cautious ahead of the developments in Greece. However, the downside was capped amid buying interest in index heavyweight Reliance Industries and a rally in auto shares.
At 2:40 PM, the Sensex was at 27,989 down 31 points and the Nifty was down 1 point at 8,452.
In the broader market, the BSE Mid-cap and Small-cap indices were up 0.6% each. Market breadth was strong with 1,422 gainers and 1,233 losers on the BSE.
On the currency front, the rupee has given up on its initial losses and is trading firm, up by 8 paise at 63.54levels amid dollar sales by banks and exporters.
MARKETS & ECONOMY
The growth in eight core sectors increased to 4.4% in May versus a decline of 0.4% in the month of April. The growth was recorded after two consecutive months of decline, thus indicating a recovery in the industrial output. Some support also came after India Meteorological Department (IMD) reported better than normal monsoon figure in the month of June.
"The outlook for inflation has improved in recent weeks, thanks to the strong start to monsoon season. Rains have been 16% above normal in June, resulting in an improvement in sowing patterns for major crops (pulses and oilseeds). While authorities still warn of weak rainfall in July, a crucial month in the season, the good start has improved reservoir levels which are likely to aid agricultural production," said Pranjul Bhandari, chief India economist at HSBC.
"The fall in both PMI input prices and prices charged is a positive indication and coupled with the strong start to monsoons, should provide the RBI more comfort around its 6% CPI target of January 2016," he adds.
Analysts say that the recent rebound in markets despite global uncertainty clearly depicts participants giving more weightage to domestic cues as expected.
"It’s too early to say that the scenario would prevail if global volatility increases in days to come. Hence, we reiterate our advice to maintain positive yet cautious approach as Nifty has almost reached near to crucial hurdle of 8,500 mark and sustainability above the same will trigger fresh upside momentum, otherwise profit taking will resume," said Jayant Manglik, President, Retail Distribution, Religare Securities in a note.
SECTORS & STOCKS
Sectorally, BSE Oil and Gas index is leading the rally, nearly up by 1% followed by FMCG and Auto sectors. The downward trend is seen in BSE IT, Metals, and Consumer Durables indices.
Bharti Airtel is set to launch full mobile number portability (MNP) from tomorrow, which will allow customers to retain their numbers across the country. The stock has surged over 2% on the Sensex.
Reliance Industries has gained 0.8% on the BSE after the company decided to invest over Rs 250,000 crore in the digital space, contributing to Digital India initiative by the Prime Minister.
Auto pack has gained on the back of strong June sales figures. M&M, Bajaj Auto, and Hero Motocorp have all gained between 0.5- 2% each on the Sensex. Tata Motors has, however, witnessed some profit-booking and is down nearly 2%
FMCG stocks gained on hopes that normal monsoon rains would help boost rural volumes. HUL has gained 0.5% while ITC is flat with positive bias.
IT stocks are trading down after reports that global IT spending is likely to decline. Also, the ongoing development in Greece has raised caution. Infosys and TCS are down 1.1% and 0.3% respectively, while Wipro is up 1.1%
