The Sensex and the Nifty, both, extended intraday losses and hit fresh intraday low in mid-morning trade. At 11:16 IST, the barometer index, the S&P BSE Sensex, was down 72.86 points or 0.22% at 33,103.14. The Nifty 50 index was down 34.90 points or 0.34% at 10,160.25.
Selling in IT and pharma shares put pressure on bourses. Weak Asian cues ahead of the US Federal Reserve policy decision later in the week, influenced trading sentiments on domestic bourses. A sharply widened current account deficit (CAD) too weighed on investors' mood.
After opening higher, key indices extended losses after slipping into negative terrain in morning trade. The Sensex rose 99.79 points, or 0.30% at the day's high of 33,275.79 in early trade. The index fell 104.80 points, or 0.32% at the day's low of 33,071.20 in mid-morning trade, its lowest level since 8 March 2018. The Nifty rose 29.40 points, or 0.29% at the day's high of 10,224.55 in early trade. The index fell 41.20 points, or 0.40% at the day's low of 10,153.95 in mid-morning trade, its lowest level since 8 March 2018.
Among secondary barometers, the BSE Mid-Cap index was down 1.20%. The BSE Small-Cap index was down 1.21%. Both these indices underperformed the Sensex.
The broad market depicted weakness. There were more than three losers against every gainer on BSE. On BSE, 1,816 shares fell and 569 shares rose. A total of 94 shares were unchanged.
IT shares declined. MindTree (down 3.72%), Persistent Systems (down 2.93%), Hexaware Technologies (down 2.45%), Tech Mahindra (down 2.03%), HCL Technologies (down 1.62%), Wipro (down 0.93%), Infosys (down 0.57%), MphasiS (down 0.56%) and Oracle Financial Services Software (down 0.46%), edged lower. TCS was up 0.51%.
Most pharmaceutical shares fell. Wockhardt (down 1.46%), Divi's Laboratories (down 1.19%), GlaxoSmithKline Pharmaceuticals (down 0.88%), Cadila Healthcare (down 0.82%), Glenmark Pharmaceuticals (down 0.82%), Alkem Laboratories (down 0.69%), IPCA Laboratories (down 0.61%), Sun Pharmaceutical Industries (down 0.49%), Aurobindo Pharma (down 0.39%) and Cipla (down 0.11%), edged lower. Lupin (up 0.10%), Dr Reddy's Laboratories (up 0.18%), Piramal Enterprises (up 0.40%) and Strides Shasun (up 1.07%), edged higher.
On the macro front, India's current account deficit (CAD) was reported at $13.5 billion (2% of GDP) in Q3 of 2017-18, up from $8 billion (1.4% of GDP) in Q3 of 2016-17 and $7.2 billion (1.1% of GDP) in the preceding quarter. The widening of the CAD on a year-on-year (y-o-y) basis was primarily on account of a higher trade deficit ($44.1 billion) brought about by a larger increase in merchandise imports relative to exports.
Overseas, most Asian stocks were trading lower as caution gripped investors ahead of the US Federal Reserve policy meeting later in the week. US stocks ended modestly higher on Friday, 16 March 2018, with the S&P 500 breaking a four-day losing streak.
US industrial production jumped 1.1% in February, the largest increase in four months. In a separate report, the Commerce Department said housing starts declined 7% to a seasonally adjusted annual rate of 1.236 million units in February. Further, the University of Michigan consumer-sentiment index rose to 102 in March from 99.7 in February.
The US Federal Reserve's two-day monetary policy meeting is scheduled on March 20-21. Strengthening labor market and a steady increase in price pressures could pave the way for the Federal Reserve to raise interest rates in upcoming meeting. The US central bank has forecast three rate increases for this year, but there are also expectations that it will raise its projection to four hikes at the meeting.
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