Weakness persisted on the bourses in mid-morning trade. At 11:25 IST, the barometer index, the S&P BSE Sensex, was down 305.08 points or 0.78% at 38,658.18. The Nifty 50 index was down 94.35 points or 0.81% at 11,617.90. Metal and mining stocks declined. Asian stocks dropped as trade negotiations between the US and China appeared to be on the verge of collapse.
Domestic stocks opened on a weak note on negative Asian stocks. Stocks traded with weakness in morning trade.
The S&P BSE Mid-Cap index was down 0.53%. The S&P BSE Small-Cap index was down 0.39%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 699 shares rose and 1340 shares fell. A total of 144 shares were unchanged.
Metal and mining stocks declined. Vedanta (down 1.4%), JSW Steel (down 3.16%), Tata Steel (down 1.56%), Steel Authority of India (Sail) (down 3.08%), National Aluminium Company (down 1.25%), Hindustan Zinc (down 0.58%), Jindal Steel & Power (down 3.16%), Hindalco Industries (down 2.36%), NMDC (down 1.4%), Hindustan Copper (down 1.42%) edged lower.
Hindustan Unilever fell 1.66% after net profit rose 13.84% to Rs 1538 crore on 8.95% rise in net sales to Rs 9809 crore in Q4 March 2019 over Q4 March 2018. The result was announced after market hours on Friday, 3 May 2019. The company posted a 7% rise in volume for the quarter, the company said in filing. The domestic consumer growth was recorded at 9%, the company added.
Prudent management of volatility in costs (crude and currency led) along with improved mix and operating leverage has driven margin improvement. Earnings before interest, tax, depreciation and amortization (EBITDA) at Rs 2321 crore, was up by 13% in Q4 March 2019 over Q4 March 2018.
Deepak Nitrite rose 7.64% after net profit rose 178.40% to Rs 56.57 crore on 23.65% rise in net sales to Rs 485.87 crore in Q4 March 2019 over Q4 March 2018. Earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at Rs 110.70 crore in Q4 March 2019, higher by 100% as against to Rs 55.40 crore reported in the same period last year. EBITDA margins improved sharply by 880 basis points to 22.7%, as compared to 13.9% in Q4 March 2018.
On the macro front, the Indian service sector lost momentum in April, with rates of new business and output growth both cooling to seven-month lows, data released today showed. Falling from 52 in March to 51 at the start of the 2019 financial year, the seasonally adjusted Nikkei India Services Business Activity Index pointed to the weakest upturn in output since last September. Moreover, the headline figure dipped below the average seen over 2018 (51.6). Growth was linked to greater bookings, improved facilities and effective marketing, though curbed by competitive pressures and the elections.
On the political front, the fifth phase of the Lok Sabha polls 2019 is underway today, 6 May 2019, with 51 Lok Sabha constituencies from 7 different states going to vote. The 2019 Indian general election, which is scheduled to be held in seven phases, kicked off on 11 April 2019. It will conclude on 19 May 2019. The counting of votes will be conducted on 23 May 2019, and on the same day the results will be declared.
Overseas, Asian stocks were trading sharply lower as trade negotiations between China and the United States deteriorated suddenly.Activity in China's service sector expanded at a slightly faster pace in April, a private gauge showed Monday. The Caixin China services purchasing managers' index rose to 54.5 in April from 54.4 in March, Caixin Media Co. and research firm Markit said.
Trading in US index futures indicated that the Dow could slump 460 points at the opening bell today. US President Donald Trump announced Sunday that tariffs on $200 billion of Chinese goods will increase next week to 25% from 10%. He also reportedly threatened that the U.S. will impose 25% tariffs on another $325 billion of Chinese goods. In response, China may reportedly withdraw from the next round of trade talks scheduled to begin Wednesday in Washington.
US stocks rose in a broad-based rally on Friday as stronger-than-expected job growth in April coupled with muted wage gains left investors upbeat about the outlook for the economy and interest rates. The Nasdaq registered a record high close, while the S&P 500 ended just shy of a record high finish.
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