Sensex, Nifty continue to trade in red

The benchmarks have recouped half of their early losses and were witnessing a rangebound session with a negative bias in line with other global markets ahead of the US Federal Reserve meeting. Lenders fell, retreating from gains on Monday, ahead of the Fed's meeting ending on Wednesday as an early end to U.S. monetary stimulus is raising worries about a weaker rupee and hence a delay in any potential RBI rate cuts.

Sentiments got dampened on profit-booking by speculators after recent gains, a weak trend on the other Asian markets with investors sitting on the sidelines as they await the US Federal Reserve’s plans for its stimulus programme. On the global front, most of Asian markets were trading in green at this point of time with Chinese market declining in early deals led by developers on concern that gains in home prices will limit scope for monetary easing.

Back home, the traders were seen piling up positions in IT, Realty and Oil & Gas while selling was seen in Bankex, Consumer Durables and Auto sector. In scrip specific actions, Siemens rose after the company received a Rs 66-crore order from NTPC for modernising its Korba plant in Chhattisgarh. Venus Remedies zoomed after the company has received patent from Mexico for its novel antibiotic Potentox. Granted by the Mexican Institute of Industrial Property (IMPI), the patent protects the composition of Potentox.JSW Steel jumped after the company reported a 40 per cent growth in May production at 10.13 lakh tonnes on higher flat products output. Sterlite Industries surged, after its copper smelter unit, which was shut down over two months ago, has resumed operations after the National Green Tribunal's expert panel gave a green signal. L&T soared on plans to bid for hydrocarbon projects outside the country, even as it is aggressively getting into the domestic defence sector worth around Rs 8,000 crore. NTPC  dropped after coal linkage to NTPC's proposed 1,980 MW North Karnapura power plant in Jharkhand has been restored but supply of the fuel will start in the next Plan period, Coal Ministry has informed dry fuel producer CIL. Shasun Pharmaceuticals slumped  after the workers at its Puducherry plant, the world's largest manufacturer of anti-inflammatory and pain drug Ibuprofen, have gone on strike, the company informed the stock exchanges on Monday.

Meanwhile, the NSE Nifty and BSE Sensex were trading just below their psychological 5,850 and 19,300 levels respectively. The market breadth on BSE was showing positive trend with advances to declines in ratio of 836:703. The BSE Sensex is currently trading at 19247.26, down by 78.61 points or 0.41% after trading in a range of 19334.07 and 19227.11. There were 11 stocks advancing against 19 declines on the index. The broader indices were trading in red; the BSE Mid cap index was down by 0.25% and Small cap index was down by 0.34%.

The only gaining sectoral indices on the BSE were, IT up by 0.20%,  Realty up by 0.16%,and  Oil & Gas up by 0.03% while Bankex down by 0.83%,  Consumer Durables down by 0.63%, Auto down by 0.49%, PSU down by 0.31% and  Metal down by 0.27% were the top losers on the BSE.

The top gainers on the Sensex were Bharti Airtel up by 0.54%, Bajaj Auto up by 0.54%, Wipro up by 0.49%, Tata Steel up by 0.40% and RIL up by 0.38%. On the flip side, Tata Motors was down by 1.82%, Hindalco Inds was down by 1.27%, NTPC was down by 1.23%, ICICI Bank was down by 1.04% and HDFC Bank was down by 1.03% were the top losers on the Sensex.

Meanwhile, Concerned over the rising prices of food items, the Reserve Bank of India (RBI) governor D Subbarao said that expensive food items like cereals, onions and vegetables has continued to put pressure on overall inflation rate. Inflation related to primary food articles grew substantially to 8.25% in May as against 6.08% reported in April.

Further, the RBI chief expressed hope that good monsoon will cool price situation and assured that the central bank is making continuous efforts to break high food inflation. Reserve Bank of India (RBI) also maintained its status quo and left the key policy rates unchanged citing elevated food inflation. It also stated that rupee depreciation and uncertainty over foreign fund inflows may put upside pressures on overall inflation.

Inflation based on the Consumer Price Index (CPI) also called retail inflation came down further to 9.31% in May as against 9.39% in the previous month. While, wholesale price index (WPI) inflation came at 43-month low level of 4.70% in April as against 4.89% for the month of April. Further, the rising difference between the WPI and CPI inflation rates has also become a concern for the central bank.   

The CNX Nifty is currently trading at 5,821.05 down by 29.00 points or 0.50% after trading in a range of 5,843.95 and 5,815.15. There were 15 stocks advancing against 35 declines on the index.

The top gainers of the Nifty were Bharti Airtel up by 0.64%, Reliance Infra up by 0.64%, BHEL up by 0.47%, JP Associaties up by 0.47% and DLF up by 0.47%. On the flip side, Ranbaxy Laboratories down by 4.03%, UltraTech Cement down by 2.29%, Tata Motors down by 1.95%, Hindalco down by 1.62% and NTPC down by 1.43% were the major losers on the index.

Most of Asian equity indices were trading in green; Jakarta Composite surged 67.43 points or 1.42% to 4,841.93, Straits Times soared 40.85 points or 1.28% to 3,224.33, KOSPI Composite rose 11.84 points or 0.63% to 1,894.94, KLSE Composite up by 0.18 points or 0.01% to 1,772.35 and Taiwan Weighted was up by 12.28 points or 0.15% to 8,005.17.

On the flip side, Shanghai Composite slipped 4.65 points or 0.22% to 2,151.56, Hang Seng dropped 166.75 points or 0.79% to 21,059.15, and Nikkei 225 was down by 72.22 points or 0.55% to 12,959.15.