Markets recover from day's low

Benchmark share indices have recovered from early lows but continue to trade in negative terrain weighed down by weak global cues, with Capital Goods, Metal and Banking shares leading the fall. Most of the recovery was led by index heavyweight Reliance Industries which was trading with marginal gains after touching an intra-day low of Rs 673 so far.

The Sensex which touched an intra-day low of 15,749 is down 122 points at 15,843 while the Nifty which touched an intra-day low of 4,770 is trading lower by 39 points at 4,803.

Meanwhile, brent crude prices fell below $98 a barrel to a 16-month low on Monday, pressured by fears of a global economic slowdown following weak US and Chinese economic data.

The rupee today lost four paise to 55.58 against the dollar in early trade as the American currency gained strength against euro and other Asian currencies.

Asian shares tumbled on Monday, pushing the broader Tokyo market to a 28-year low, as investors extended a rout of global stocks and worried about a nightmare scenario of euro-zone breakup, US economic relapse and a sharp slowdown in China.

Tokyo's broader Topix index lost 2.1% to 693.35, a level not seen since late 1983, as Asian markets plumbed new lows for 2012. Japan's Nikkei average fell 2% after last week marking its ninth straight week of losses, the longest such losing streak run in 20 years.

Back home, all the sectoral indices are trading in red zone. BSE Consumer Durable index has plunged by nearly 3% followed by counters like Realty, Metal, Technology, Power, Healthcare, FMCG, PSU, Banks and Capital Goods, all slumping between 1-2%.

From the Consumer Durable space, Bajaj Electrical, Blue Star, C Mahindra, Rajesh Exports, Titan and VIP Inds have slipped between 1-4% on concerns that rising inflation would reduce the purchasing power of consumers thereby lowering demand for products.

Among Realty pack, DLF is the top Sensex loser, down over 4%. DLF tanked over 5% to Rs 169.55 in the early trades, its lowest level since March 2009, on back of huge volumes. According to a presentation by an analyst, DLF's net debt stood at Rs 22,725 crore as on March 31, 2012, which is now five times the company's FY12 EBITDA of Rs 4,500 crore.

Shares of software exporters are down on concerns of slowdown of the US economy and as jobless claims increased for the seventh week in eight and ahead of the monthly payroll data due later today. India's software exporters earn most of their revenues from software exports to the US. TCS, Wipro and Infosys are down between 1-2%.

Metal shares like Hindalco, Sterlite, Coal India, Jindal Steel and Tata Steel have declined between 1-2% on worries that demand from China, the world's largest consumer of metals, would remain subdued after its economy witnessed contraction.

On the gaining side, Tata Motors, ONGC have risen by nearly 1% each on value buying at lower after the sharp losses in the past week. Tata Motors slumped nearly 17% last week on account of lower than expected EBITDA (earnings before interest, taxes, depreciation, and amortization) margin at Jaguar Land Rover (JLR) of 14.6% against analyst estimate of around 16.5% during the quarter ended March 2012.

Among other shares, Cairn India has dipped 5% to Rs 301, extending its around 5% fall in past three trading days, after Brent crude oil prices fell to a 16-month low, due to weak U.S. and Chinese economic data.

MphasiS is trading higher by 3% at Rs 379 after the IT consulting and services firm said that its EBIT margins expanded 120 bps in Q2FY12 to 16.2% on the back of emphasis on cost rationlisation and productivity gains.

Shares of fertiliser manufacturers gained ahead of arrival of the monsoon season, which will boost demand for fertilizers. The monsoon is expected to hit the southern state of Kerala in the next 48 hours, according to the India Meteorological Department (IMD).

Among the individual stocks, National Fertilisers, Rashtriya Chemicals and Fertilisers, Zuari Industries and Gujarat State Fertilisers Company are trading higher by 2-8% in early noon deals, in otherwise weak market on the Bombay Stock Exchange.

Meanwhile, Meanwhile, BSE Midcap index has plunged by 0.97% whereas BSE Smallcap index is down 0.7%.

The market breadth in BSE remains unhealthy with 1,459 shares declining and 750 shares advancing.