Benchmarks drift lower in early deals on global weakness

Extending their previous session’s southward journey, Indian equity indices have made a negative start on Wednesday pressurized by weak global cues. The US markets turned negative overnight, though stocks recovered during the day after moving sharply lower in early trade but the session was marred by volatility, mainly due to the Japan’s monetary policy stance. All the Asian equity indices were trading in red at this point of time with Japanese stocks tumbling by over one and a half per cent, joining a global sell-off in equities and commodities as investors were rattled by the absence of fresh steps from the Bank of Japan to calm turbulence in the domestic bond market. 

Back home, investors also remained sidelines ahead of April industrial output and consumer price index-based inflation data to be released later in the day, which will help determine the RBI’s stance on the June 17 monetary policy review. Moreover, with a sharp drop in PMI it is being expected that IIP may throw up unpleasant surprise. Some pressure also came in from selling in Auto space after Society of Indian Automobile Manufacturers (SIAM) said that the car sales in India fell an annual 12.3% in May.

On the sectoral front, oil and gas witnessed the maximum gain in trade followed by realty and healthcare while, consumer durables, fast moving consumer goods and auto remained the top losers on the BSE sectoral space. The broader indices too were struggling to get some traction, while the market breadth on the BSE was negative; there were 510 shares on the gaining side against 698 shares on the losing side while 55 shares remain unchanged.

The BSE Sensex opened at 19,103.96; about 39 points lower compared to its previous closing of 19,143.00, and has touched a high and a low of 19,135.20 and 19,032.08 respectively.

The index is currently trading at 19,070.93, down by 72.07 points or 0.38%. There were 12 stocks advancing against 17 declines and one remains unchanged on the index.

The overall market breadth has made a weak start with 40.38% stocks advancing against 55.27% declines. The broader indices too were trading in red; the BSE Mid cap and Small cap indices down by 0.27% and 0.11% respectively. 

The only gaining sectoral indices on the BSE were, Realty up by 0.48%, Health Care up by 0.19%, Capital Goods up by 0.14% and Bankex up by 0.03%, while Consumer Durables down by 4.51%, FMCG down by 1.24%, Auto down by 0.74%, Metal down by 0.67% and Teck down by 0.47% were the top losers on the sectoral index.

The top gainers on the Sensex were Jindal Steel up by 0.88%, ICICI Bank up by 0.80%, RIL up by 0.64%, Tata Power up by 0.61% and Gail India up by 0.60%.

On the flip side, Bajaj Auto was down by 2.66%,  ITC was down by 1.88%, Hero MotoCorp was down by 1.85%, TCS was down by 1.73% and Coal India was down by 1.51% were the top losers on the Sensex.

Meanwhile, buoyed by improved spending behaviour and easing inflation, Indian consumers' confidence level rose in the month of May as against the same month last year. The BluFin's Consumer Confidence Index (CCI), assessing the pulse of urban Indian consumers with regard to the economy, spending behaviour and employment, rose to 41.4 points in May, an increase of 3.4 points from January’13.

The index reflects pessimism at below 50 score and optimism above that and these two key components indicate improvement in the consumer sentiment. Further, a sub index of CCI, which rates inflation sentiment, rose from 23.9 points in January to 26.8 points in May, while the spending sentiment improved from 28.3 points to 30.5 points in the same period. However, employment sentiment declined to 50.2 points in May from 51.4 points in January. While, the score itself is encouraging as it is above the benchmark level of 50.

Further, BluFin noted that consumers were still pessimistic about the economy's prospects as CCI sub-index which measures future expectations, was at 40 points. In terms of region, consumers from North India, who are most sensitive to economic vagaries are showing increased propensity to spend as the consumer confidence in North India registered a rise of about two points to 39 points in May, after a steady decline since January 2013.    

The CNX Nifty opened at 5,771.75; about 7 points lower as compared to its previous closing of 5,788.80, and has touched a high and a low of 5,789.95 and 5,756.10 respectively.

The index is currently trading at 5,769.75, down by 19.05 points or 0.33%. There were 25 stocks advancing against 25 declines on the index.

The top gainers of the Nifty were DLF up by 1.44%, IndusInd Bank up by 1.04%, Tata Power up by 0.85%, Jindal Steel up by 0.84% and JP Associate up by 0.82%.

On the flip side, Bajaj-Auto down by 2.70%, Axis Bank down by 2.34%, TCS down by 2.02%, Hero MotoCorp down by 1.94% and ITC down by 1.75% were the major losers on the index.

All the Asian equity indices were trading in red; Jakarta Composite declined 68.77 points or 1.49% to 4,541.18, KLSE Composite dropped 11.40 points or 0.64% to 1,768.17, Nikkei 225 tumbled 215.03 points or 1.61% to 13,102.59, Straits Times slipped 7.81 points or 0.25% to 3,162.57 and KOSPI Composite was down by 8.21 points or 0.43% to 1,912.47.

Markets in China, Hong Kong and Taiwan remained shut for the trade today.