Markets have dropped further on selling pressure in auto and select bank shares. Auto shares declined on concerns of slow down in sales growth during April.
The Sensex was down 115 points at 17,187 and the Nifty was down 38 points at 5,201.
Among Sensex shares, ICICI Bank was down 2.4% at Rs 861 while SBI was down 1.5% at Rs 2,106. Among auto shares, Hero MotoCorp was down 5.6% at Rs 2,118. Other losers include, Tata Motors down 1.5% while Bajaj Auto slipped 3.2%.
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(Updated at 9:40am)
Markets have commenced the trading session on a lower note tracking weak global cues. At 9:40, the Sensex was down 80 points at 17,222 levels whereas the Nifty declined 29 points at 5,210 levels.
On the global front, Asian shares slipped on Thursday and the euro wallowed near a two-week low after disappointing data from both sides of the Atlantic rekindled concerns about the strength of the global economic recovery.
US stocks eased on Wednesday as data showed a slowdown in private sector hiring, tempering the optimism from a better-than-expected manufacturing survey at the start of the week that had driven the Dow to its highest in more than 4 year.
MSCI's broadest index of Asia Pacific shares outside Japan slipped 0.1%, with South Korean shares down 0.3%. Tokyo financial markets were closed for a public holiday.
Back home, the Nifty is likely to face resistance around 5,260-5,275, while it can seek support around 5,220-5,205 levels, technical analysts suggest.
On the sectoral front, BSE Auto, Realty, Metal, PSU, Oil & Gas, Power and Bankex indices have plunged by almost 1% each. Apart from Consumer Durable, all the major BSE sectoral indices are trading in red zone.
From the Auto segment, Hero MotoCorp is the top Sensex loser, down nearly 6% after reporting lower-than-expected 20% year-on-year (y-o-y) growth in net profit at Rs 604 crore for the quarter ended March 2012, due to higher raw material cost. Analyst had expected a net profit of Rs 626 crore from the world's largest two-wheeled vehicle manufacturer. Total income grew 12% at Rs 6,140 crore on y-o-y basis.
Among others, Bajaj Auto, Maruti Suzuki, M&M and Tata Motors fell by almost 1% each. The tractor sales of Mahindra & Mahindra's Farm Equipment Sector have declined by nearly 10% to 16,049 units in the domestic market in April 2012.
From the banking space, SBI, ICICI Bank and HDFC have declined by nearly 1% each.
Other notable losers include Tata Power, Tata Steel, Bharti Airtel, Coal India, DLF, GAIL India and ONGC, all slipping by almost 1% each.
Among other shares, VIP Industries has skidded 5% at Rs 88.45, extending its previous day’s over 4% fall after its consolidated net profit for the March quarter more than halved at Rs 7.80 crore due to operating expenditure. The company had a net profit of Rs 16.30 crore in the corresponding quarter of previous fiscal.
The market breadth on the BSE is marginally negative with 744 losers and 622 gainers.
