Stocks staged a mild recovery after hitting fresh intraday low in early afternoon trade. At 12:19 IST, the barometer index, the S&P BSE Sensex, was down 282.07 points or 0.78% at 35,727.77. The Nifty 50 index was down 91.80 points or 0.85% at 10,703.15. Capital goods stocks edged lower. Sentiment was impacted by weak IIP data and negative Asian stocks.
The Sensex was trading below the psychological 36,000 level after sliding below that level in early trade. Domestic stocks drifted lower in early trade on negative Asian stocks. Data showing a sharp drop in IIP in November 2018 also dented early sentiment. Stocks extended initial fall in morning trade. Weakness persisted on the bourses in mid-morning trade on selling pressure in index pivotals.
The market sentiment was impacted by data showing that foreign funds were net sellers of Indian stocks on Friday, 11 January 2019. The trading activity on that day showed that the foreign portfolio investors (FPIs) sold shares worth a net Rs 687.20 crore on Friday, 11 January 2019, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 123.17 crore on Friday, 11 January 2019, as per provisional data.
The S&P BSE Mid-Cap index was down 0.71%. The S&P BSE Small-Cap index was down 0.56%.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 835 shares rose and 1382 shares fell. A total of 162 shares were unchanged.
Capital goods stocks edged lower. ABB India (down 1.83%), Bharat Heavy Electricals (Bhel) (down 0.95%), BEML (down 1.97%), Bharat Electronics (down 1.63%), L&T (down 2.7%), Punj Lloyd (down 1.72%) and Thermax (down 0.79%) declined. Siemens (up 0.19%) rose.
Avenue Supermarts fell 8.57% after net profit rose 2.12% to Rs 257.11 crore on 33.15% rise in net sales to Rs 5450.94 crore in Q3 December 2018 over Q3 December 2017. The result was announced on Saturday, 12 January 2019.
Avenue Supermarts' earnings before interest, tax, depreciation and amortization (EBITDA) in Q3 December 2018 stood at Rs 453 crore, up by 7.5%. The company's EBITDA margin is at 8.3% in Q3 December 2018 as compared to 10.3% in Q3 December 2017.
On the macro front, India's index of industrial production (IIP) (base year 2011-12=100) moderated sharply to mere 0.5% in November 2018, compared with 8.4% growth recorded in October 2018. The industrial production growth for October 2018 has been revised upwards from 8.1% increase reported provisionally. The data released after market hours on Friday, 11 January 2019.
The output of manufacturing sector declined 0.4%, while the electricity generation growth moderated to 5.1%% in November 2018. Further, the mining output growth also eased to 2.7% in November 2018.
Overseas, Asian shares were trading lower as China reported a slowdown in exports. Markets in Japan are closed for a holiday. China said Monday that its exports to the U.S. contracted in December although its overall trade surplus with the U.S. hit a record $323 billion in 2018. Exports to the U.S. rose 11.3% to $478.4 billion for the year despite punitive tariffs imposed by President Donald Trump in a fight over Chinese technology ambitions. The customs data showed imports of American goods rose just 0.7% over 2017, reflecting the impact of Beijing's retaliatory tariffs and encouragement to importers to buy more from non-U.S. suppliers.
In US, the Wall Street dipped slightly on Friday, breaking a five-session rally, as energy shares declined and investors looked ahead to earnings season. The Dow Jones Industrial Average ended down 0.02% at 23,995.95 points, while the Nasdaq Composite dropped 0.21% to 6,971.48. The S&P 500 ended down 0.01% at 2,596.26.
Meanwhile, the partial US government shutdown entered its 21st day, tying the record for the longest in history. Economists reportedly warn that the economic effects of the shutdown could grow significant as the standoff drags on.
In Europe, British Prime Minister Theresa May reportedly warned Sunday that lawmakers risk undermining the public's faith in democracy if they reject her divorce deal with the European Union in a vote set for Tuesday. May said some members of Parliament were playing political games with the Brexit debate. Lawmakers, she said, should respect the results of the 2016 referendum in which 52% of voters backed leaving the EU.
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