Key benchmark indices cut losses in highly volatile mid-afternoon trade soon after reversing intraday gains. At 14:23 IST, the barometer index, the S&P BSE Sensex, was down 59.61 points or 0.17% at 34,889.63. The Nifty 50 index was down 23.55 points or 0.22% at 10,609.75. Most auto stocks declined. Metal and mining stocks saw mixed trend.
Domestic stocks began trading for the day on a downbeat note on weak Asian stocks. Stocks cut losses in morning trade. After a brief intraday pullback, the key benchmark indices once again resumed decline in mid-morning trade on fresh selling in index pivotals. Indices reversed trend after hitting fresh intraday high in afternoon trade.
The S&P BSE Mid-Cap index was up 0.01%. The S&P BSE Small-Cap index was off 0.18%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was negative. On the BSE, 1,142 shares rose and 1,444 shares fell. A total of 157 shares were unchanged.
Most auto stocks declined. Tata Motors (down 1.56%), Maruti Suzuki India (down 1.04%), Eicher Motors (down 1.14%), Ashok Leyland (down 1.1%), Bajaj Auto (down 0.82%) and Hero MotoCorp (down 0.19%) declined.
Mahindra & Mahindra (M&M) (up 2.8%), Escorts (up 0.5%) and TVS Motor Company (up 1.95%) rose.
Metal and mining stocks saw mixed trend. Vedanta (down 0.32%), JSW Steel (down 0.18%), Jindal Steel & Power (down 0.41%) and Hindalco Industries (down 1.53%) fell. Hindustan Copper (up 1%), Tata Steel (up 0.27%), Steel Authority of India (Sail) (up 1.5%), National Aluminium Company (up 1.61%) and Hindustan Zinc (up 1.9%) rose.
Overseas, shares in Europe and Asia dropped as concerns about the repercussions of Italy's political turmoil and the renewal of trade tensions between the US and China gripped financial markets. The prospect that Italy might need a fresh election that could effectively become a referendum on the nation's inclusion in the euro zone rattled markets.
US stocks tumbled yesterday, 29 May 2018 joining a global equity selloff sparked by concern Italy's political woes will destabilise Europe.
On the Federal Reserve front, St. Louis Fed President James Bullard reportedly said early Tuesday in Japan that it was difficult for the US central bank to raise interest rates by a large margin when the Bank of Japan and the European Central Bank were pursuing accommodative policy.
Investors are also keeping an eye on the White House, with the Trump administration giving conflicting signals on talks with North Korea and plowing ahead with plans for tariffs on Chinese goods. On Saturday, 2 June 2018 US Secretary of Commerce Wilbur Ross will reportedly travel to Beijing for more talks with Vice Premier Liu He on topics including ZTE Corp. and trade.
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