Nifty slips over 1% on disappointing March industrial output

The equity markets, which opened on a weak note this morning on negative global cues, drifted lower in late morning trades following industrial production data for March 2012. Meanwhile, the Index of Industrial Production (IIP), a key measure of industrial output, contracted at an astonishing (-3.5%) in March versus 4.1% in the month of February. The Sensex was down 148 points at 16,278 and the Nifty fell 52 points. However, JSW Steel tanked 7% after the Supreme Court has ordered CBI probe against the company and BJP's BS Yeddyurappa in mining case. In the currency market, the rupee opened lower against the dollar this morning as renewed concerns about the euro zone hurt riskier assets. On sectoral front all sectors were trading in red. On the global front, Asian shares retreated on Friday, spooked by JPMorgan's $2 billion huge loss from a failed hedging strategy. Back home, the market breadth favoring negative trend; there were 740 shares on the gaining side against 1,604 shares on the losing side while 102 shares remained unchanged.

The BSE Sensex is currently trading at 16,271.21, down by 148.84 points or 0.91%. The index has touched a high and low of 16,395.12 and 16,233.76 respectively.  There were 7 stocks advancing against 23 declines on the index.

The broader indices too enticed some additional weakness; the BSE Mid cap and Small cap indices declined 1.20% and 1.07% respectively.

Selling was broad based so there were no gainer on the BSE sectoral space, however, the major losing sectoral indices on the BSE were, FMCG down by 1.74%, Metal down by 1.63%, Realty down by 1.55%, HC down by 1.50% and CG down by 1.39%.

The top gainers on the Sensex were Bajaj Auto up by 0.81%, BHEL up by 0.71%, Hero MotoCorp up by 0.28%, Tata Motors up by 0.22% and Gail India up by 0.20%.

On the flip side, Sun Pharma down by 3.32%, Maruti Suzuki down by 2.78%, Hindalco down by 2.60%, ITC down by 2.58% and L&T down by 2.41% were the top losers on the Sensex.

Meanwhile, India's annual industrial output growth measured by index of industrial production (IIP) with an updated base of 2004-05, stunned one and all as it unexpectedly shrank 3.5% in March, falling behind all estimates. The general index for the month of March 2012 stood at 186.4, which is 3.5% lower as compared to the level in the month of March 2011. The cumulative growth for the period April-March 2011-12 stands at 2.8% over the corresponding period of the previous year.

According to the data released by Central Statistics Office, the IIP for the Mining, Manufacturing and Electricity sectors for the month of March 2012 stand at 149.3, 197.1 and 158.6 respectively, with the corresponding growth rates of -1.3%, -4.4% and 2.7% as compared to March 2011. The cumulative growth in the three sectors during April-March, 2011-12 over the corresponding period of 2010-11 has been -2.0%, 2.9% and 8.2% respectively, which moved the overall growth in the General Index to 2.8%.

As per use-based classification, the growth rates in March 2012 over March 2011 are 1.1% in Basic goods, -21.3% in Capital goods and -2.1% in Intermediate goods. The Consumer durables and Consumer non-durables have recorded growth of 0.2% and 1.0% respectively, with the overall growth in Consumer goods being 0.7%.

The S&P CNX Nifty is currently trading at 4,912.80, lower by 52.90 points or 1.07%. The index has touched a high and low of 4,954.05 and 4,906.45 respectively. There were only 8 stocks advancing against 42 declines on the index.

The top gainers of the Nifty were BHEL up by 0.73%, Bajaj Auto up by 0.65%, Tata Motors up by 0.43%, Reliance up by 0.36% and JP Associates up by 0.33%.

On the flip side, Sun Pharma down by 3.53%, Ranbaxy down by 3.44%, Maruti Suzuki down by 2.93%, ITC down by 2.80% and Hindalco down by 2.77% were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite declined by 0.43%, Hang Seng plunged 1.60%, Jakarta Composite shed 0.77%, KLSE Composite lost 0.07%, Nikkei 225 slid 0.63%, Straits Times shed 0.91%, KOSPI Composite plunged 1.43% and Taiwan Weighted plummeted 1.10%.