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Markets extended losses in noon trades on Wednesday amid a weak monsoon forecast while cautious stance by the RBI also weighed on market sentiment.
At 12:20PM, the 30-share Sensex was down 450 points at 26,738 and the 50-share Nifty was down 130 points at 8,106.
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(Updated at 11:40AM)
Markets have slipped further weighed down by significant selling pressure among index heavyweight shares like ITC and Tata Motors. Meanwhile, the sentiments of the market participants are dampened further after India's services activities dropped for the first time in the span of thirteen month on lack of demand.
At 11:40 AM, Sensex was at 26,926 levels, down by 262 points or 1% while the Nifty was down to 8,155 levels, shedding 81 points or 1%
The broader markets, are, however underperforming the larger peers with BSE Midcap and Smallcap indices down by 1.31% and 1.37%, respectively. The market breadth is negative with 1,616 declines against 593 advances on the BSE.
The India Meteorological Department (IMD) on Tuesday revised its projection of the 2015 monsoon from slightly less than normal to deficient as the El Niño weather phenomenon gained strength, pushing parts of the country to the brink of an expected drought.
Meanwhile, India's services activities fell for the first time in 13 months in May as demand remained subdued, showed a widely-tracked HSBC purchasing managers' index (PMI). This, coupled with the news of deficient rains does not augur well as now almost three-fourth of the economy faces problems. PMI was down to 49.6 points in May from 52.4 in April.
The rupee recovered marginally by five paise at 63.77 against the US dollar at Interbank Foreign Exchange after the greenback weakened overseas.
BUZZING STOCKS
All sectors are trading in red on the Sensex with consumer durables and FMCG being the major laggards, losing over 2%. Bankex and Auto have dropped between 0.5-1.5 % on the Sensex.
Rate-sensitive sectors are also witnessing selling pressure after the Reserve Bank of India at its monetary policy review yesterday signalled that it would await data on monsoon forecast and keep check inflation before any further rate cuts.
Tata Motors has dropped over 4.5% on the Sensex and is the top loser, leading the downfall.
Financial sector is witnessing selling pressure post the announcement of RBI’s bi-monthly monetary policy review on Tuesday in which the central bank announce a 25 bps cut on repo rate.
From the financial space, Axis Bank, ICICI Bank, SBI have lost between 0.5- 1.5% each whereas HDFC twins gained around 1% on the Sensex.
Shares of index heavyweight ITC have declined further over 4% on the BSE after reports that Maharashtra government has put a ban on sale of loose cigarettes. Further, ITC has turns ex-dividend today, for dividend of Rs 6.25 per share for the year ended 31 March 2015.
On the gaining side, Coal India is leading the chart on BSE with around 1.6% gains. Other notable gainers on the Sensex are Wipro, Reliance Industries, NTPC, all gaining between 0.7-1.1 % each.
Shares of Adani Enterprise have plunged 80% to Rs 124 on the Bombay Stock Exchange (BSE) on reports stating that the company separated its port and power arm and merged them with Adani Ports and Adani Power business.
Shares of Emami have gained more than 3% to Rs 1,105 on the National Stock Exchange (NSE) in the early morning trades after the FMCG major declared that has plans to acquire the hair and scalp care brand Kesh King from SBS Biotech, a Himachal Pradesh company, worth Rs 1,651 crore.
Shares of Nestle have dropped over 7% to Rs 6,310 on the Bombay Stock Exchange (BSE) after the Delhi government summoned officials of Nestle India claiming that the samples of Maggi noodles fail to meet food safety norms and are unsafe.
