Benchmarks make gap down start on weak global cues

The Indian equity markets have made a gap down start tracking negative cues from global indices. The US markets suffered sharp decline overnight with all the major indices losing over two percent each and all the Asian peers were trading in the negative terrain at this point of time, indicating somber investors' sentiments. Back home, selling witnessed in most of the key heavyweights and broader indices dragged the BSE's Sensex and NSE's Nifty below their crucial 18,500 and 5,550 mark. On the sectoral front, fast moving consumer goods witnessed the maximum gain in trade followed by consumer durables and healthcare while, realty, banking and metal remained the top losers on the BSE sectoral space. Moreover, investors remained cautious ahead of the release of food inflation data later today also dampened the sentiment. The broader indices too were bleeding badly in the trade. The market breadth has made a negative start; there were 503 shares on the gaining side against 1059 shares on the losing side while 59 shares remained unchanged.

The BSE Sensex opened at 18,425.85; about 183 points lower compared to its previous closing of 18,608.81, and has touched a high and a low of 18,481.55 and 18,390.57 respectively.

The index is currently trading at 18,450.91, down by 157.90 points or 0.85%. There were 8 stocks advancing against 22 declines on the index.

The overall market breadth has made a negative start with 31.03% stocks advancing against 65.33% declines. The broader indices too were bleeding badly; the BSE Mid cap and Small cap indices were down by 0.70% and 0.66% respectively. 

The only gaining sectoral indices on the BSE were, FMCG up by 0.31%, CD up by 0.09% and HC was up by 0.03%. While, Realty down by 1.60%, Bankex down by 1.52%, Metal down by 1.31%, Auto down by 1.18% and CG down by 0.95% were the top losers on the index.

The top gainers on the Sensex were HUL up by 1.79%, Cipla up by 1.73%, Bharti Airtel up by 0.88%, Hero Honda up by 0.70% and ONGC was up by 0.60%.

On the flip side, ICICI Bank down by 2.76%, Tata Motors down by 2.26%, DLF down by 1.86%, Sterlite Industries down by 1.67% and Maruti Suzuki down by 1.60% were the top losers on the index.

Meanwhile, India's manufacturing Purchasing Managers' Index fell slightly for the month of May, the seasonally adjusted HSBC Markit Purchasing Managers' Index (PMI) came in at 57.5 in May, down from April's 58 points, the momentum in the sector eased due to a slowdown in output and new order growth. 

The new orders sub-index slipped in May to 62.4, weaker than the 63.1 reported in April.  Still, the latest reading indicates marked growth in the manufacturing sector. New orders advanced substantially, underpinned by improvements in general economic conditions. But the overall growth eased for a second successive month. Consequently, output growth slowed from a fourteen-month high posted in April.

Further, employment in manufacturing sector showed a decline, which was the fourth fall in last five months. On the other hand, manufacturers' increased purchasing activity, as new orders and output increased in May.

Although input price inflation slowed from March's series high, it remained notably strong in the context of historical data. The survey also showed the output prices sub-index picked up speed in May while input prices remained elevated. The increase in output prices in May was slightly sharper than in the previous survey period.  Output growth was driven by a pickup in new orders and production backlogs piled up at a slower pace.  

But the decline was not concentrated to India alone, purchasing managers indexes release today showed manufacturing strength receding around majority of Asian nations. The PMI of China fell to a 10-month low of 51.6 from 51.8, in South Korea, manufacturing growth slowed to its slowest pace in six months, with HSBC's PMI falling to 51.2 from 51.7. Together with disappointing industrial production, the data indicate declining momentum in Asia's fourth-biggest economy. The decline indicates that world's main economic engines have started cooling down as richer countries curtail orders.

The S&P CNX Nifty opened at 5,529.90; about 63 points lower compared to its previous closing of 5,592.00, and has touched a high and a low of 5,548.25 and 5,521.95 respectively.

The index is currently trading at 5,547.40, down by 44.60 points or 0.80%. There were 15 stocks advancing against 35 declines on the index.

The top gainers of the Nifty were Reliance Capital up by 1.92%, HUL up by 1.56%, Cipla up by 1.41%, ONGC up by 0.94% and Bharti Airtel up by 0.84%.

Sesa Goa down by 2.44%, Tata Motors down by 2.12%, DLF down by 2.09%, IDFC by 2.05% and Maruti Suzuki was down by 1.85%, were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite was down 53.91 points or 1.96% to 2,689.66, Hang Seng was down 374.59 points or 1.59% to 23,251.84, KLSE Composite was down 3.09 points or 0.20% to 1,553.33, Nikkei 225 was down 161.19 points or 1.66% to 9,558.42, Straits Times was down 17.88 points or 0.56% to 3,154.99, Seoul Composite was down 29.06 points or 1.36% to 2,112.28 and Taiwan Weighted was down by 60.10 points or 0.66% to 9,002.25 

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