Bears tighten grip on markets

Bears hold their tight grip on Indian equity markets in late afternoon session, on the back of weak opening in European markets. In line with the larger peers, the broader markets were also lingering under pressure with the heavy losses of 0.88% each. Trading sentiments remained affected, after India’s services sector fell for the second consecutive month in April, with rates of new business and output growth both cooling to seven-month lows. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index eased to 51 in April from 52 in March. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services -- also slipped to 51.7 in April as against 52.7 in March. Market participants paid no heed towards reports that with a view to facilitate fundraising by start-ups, the Department for Promotion of Industry and Internal Trade (DPIIT) has proposed relaxation in the income tax laws pertaining to sale of residential properties and carrying forward of losses.

On the sectoral front, rubber stocks were in focused, as the state-run Rubber Board said that India's natural rubber imports in 2018-19 surged to a record high as production dropped amid a rise in consumption. The world's second-biggest consumer of natural rubber imported 582,351 tonnes rubber in 2018-19, up 24 percent from the previous year.

On the global front, European markets were trading in red, as Eurozone's consumer price inflation accelerated more-than-expected in April to its highest level in five months, led by higher energy prices and service costs, and core price growth was the fastest in six months. The preliminary data from Eurostat showed that the consumer price index rose 1.7 percent year-on-year following a 1.4 percent increase in March. Asian markets were also trading in red, after US President Donald Trump vowed to hike tariffs on China and the Wall Street Journal said that China is considering canceling trade talks with the United States this week.

The BSE Sensex is currently trading at 38530.17, down by 433.09 points or 1.11% after trading in a range of 38509.79 and 38719.33. There were 4 stocks advancing against 27 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.88%, while Small cap index was down by 0.88%.

The lone gaining sectoral index on the BSE was Telecom up by 0.42%, while Consumer Durables down by 2.98%, Metal down by 2.31%, Basic Materials down by 1.45%, Industrials down by 1.40% and Consumer Disc down by 1.38% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 1.00%, TCS up by 0.97%, Bharti Airtel up by 0.60% and Sun Pharma up by 0.25%. On the flip side, Yes Bank down by 5.38%, Tata Motors down by 4.65%, Tata Motors - DVR down by 4.43%, Tata Steel down by 2.64% and HDFC down by 2.22% were the top losers.

Meanwhile, India’s services sector fell for the second consecutive month in April, with rates of new business and output growth both cooling to seven-month lows. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index eased to 51 in April from 52 in March. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services – also slipped to 51.7 in April as against 52.7 in March.

The survey report pointed that rise in incoming new work at services firms was only slight and the weakest in seven months, curtailed by greater online bookings among customers, competitive conditions and the elections. The report further said that the rise in employment was also moderate, though quickened from March, buoyed by ongoing improvements in new work and optimistic growth projections.

According to the survey report, Indian services firms continued to report greater levels of unfinished business during the month of April. It said that delayed client payment was cited as the key reason preventing firms from completing outstanding workloads. Backlogs also increased among goods producers.

On the inflation front, input price inflation in India’s service economy moderated to the second-slowest rate recorded in almost two years. In fact, close to 98% of companies indicated unchanged cost burdens from March. Across the private sector, the latest increase in input prices was the least pronounced in close to two-and-a-half years.

The CNX Nifty is currently trading at 11576.85, down by 135.40 points or 1.16% after trading in a range of 11571.35 and 11632.55. There were 9 stocks advancing against 41 stocks declining on the index.

The top gainers on Nifty were BPCL up by 2.02%, TCS up by 1.03%, ITC up by 0.71%, Indian Oil Corporation up by 0.35% and Tech Mahindra up by 0.24%. On the flip side, Titan down by 5.85%, Zee Entertainment down by 5.64%, Yes Bank down by 5.54%, Tata Motors down by 4.94% and JSW Steel down by 4.35% were the top losers.

Asian markets were trading in red; Taiwan Weighted slipped 199.18 points or 1.8% to 10,897.12, Hang Seng decreased 991.94 points or 3.3% to 29,089.61, Shanghai Composite declined 175.81 points or 5.71% to 2,902.53, Straits Times trembled 107.21 points or 3.16% to 3,285.08 and Jakarta Composite was down by 77.31 points or 1.22% to 6,242.15.

European markets were trading in red; France’s CAC fell 118.73 points or 2.14% to 5,430.11 and Germany’s DAX was down by 258.66 points or 2.08% to 12,154.09.