Indian markets to get a gap-down start in sync with the global peers

The Indian markets suffered sharp plunge in the last session, the concerns of weak GDP numbers got enlarged with lots of agencies pruning India’s growth target. Though, the manufacturing, despite slight decline continued its momentum but the mood remained cautious with the global jitters. Today, the start of the new week is likely to be a gap-down one and Nifty may trade below psychological levels of 4800 in the very early trade. The industrial growth is likely to remain under pressure and may show sharp decline in the next quarter as the survey by the Confederation of Indian Industry has stated that growth of industrial sectors such as textile machinery, cement and fertilizer may get derailed in the April-June quarter. Meanwhile, manufacturing that has continued its pace in the passing month may get a boost as the government has set up a high-level board under commerce and industry minister Anand Sharma to boost manufacturing sectors. The PSU oil marketing companies will remain in limelight after going for a partial roll-back in the petrol price hike. In other development the chairman and managing directors' of Indian Oil Corporation, HPCL and BPCL in  a statement have clarified that the OMCs were able to report profit in 2011-12 mainly due to assistance of Rs 83,500 crore from the government and Rs 55,000 crore from the upstream oil companies.

The US markets slumped on Friday, witnessing their weakest intraday close of the year on getting unexpectedly weak jobs report, the feeble economic news from Europe and China too weighed on the sentiments. The Asian markets have made a shabby start of the day and most of the indices are down by over two percent on concern of slowing global economic growth, sparked by the weak US jobs data. Chinese market is down by around one and half a percent, as country’s non-manufacturing industries expanded at the slowest pace in more than a year and the purchasing managers’ index fell to 55.2 in May from 56.1 in April.

Back home, stock markets in India started the month of June on a daunting note with the benchmark equity indices getting pummeled by over one and half a percent and slipping below crucial technical levels. The frontline equity indices traded in a narrow range for most part of morning trades but a sharp wave of selling pressure emerged in late morning trades around the psychological 4,900 (Nifty) and 16,150 (Sensex) levels, which pushed the key gauges into a downslide. Market’s south bound journey only came to a halt with the close of trade as sentiments remained uninspiring right from the start of trade. Apart from persistent disappointment over India’s horrendous fourth quarter GDP growth numbers, cues from across the globe too remained somber. Moreover, market’s mood also went awry after various influential brokerage houses slashed India’s economic growth forecasts to below the 6% threshold. Meanwhile, a HSBC survey highlighted that though India's manufacturing PMI slipped slightly to 54.8 in May from 54.9 in April, the manufacturing sector kept up its steady expansion as slowing growth of domestic order books was evened out by fast-rising output. Besides, the slight appreciation in rupee against the US dollar did little to support sentiments in the falling market. Shares from the Auto sector got hammered by over two percent after companies released a weaker than expected monthly sales numbers. Spicejet and Jet Airways from the Aviation pocket that traded on a sanguine note for most part of the day after oil companies reduced the prices of jet fuel prices by 2%, pruned their gains by the end and settled with sharp losses. On the BSE sectoral front, investors were seen squaring off hefty positions from the Capital Goods counter, which got battered by about three percent, being the top laggard in the space a day after reports showed India's eight core industries growth, having a combined weight of around 38% percent in the IIP, slowed down to 2.2 percent in April from the 4.2 percent in last April. Finally, the BSE Sensex shaved off 253.37 points or 1.56% to settle at 15,965.16, while the S&P CNX Nifty plunged by 82.65 points or 1.68% to close at 4,841.60.