The Sensex opened in the negative territory as sentiment turned bearish in global markets following poor US jobs data and concerns of a slowdown in China. All sectoral indices were in the red with capital goods, metals, banks and technology stocks leading the declines.
The Nifty was at 4,778.15, down 63.45 points, or 1.31 percent. The 50-share index has touched a high of 4,797.85 and a low of 4,777.10 today.
The Sensex fell 1.3 percent, hitting its lowest since January 9, according to a Reuters report. The BSE index is close to erasing its gains for the year, currently at 15,761.48 points versus its 15,454.92 close at the end of 2011. Blue-chip stocks led the declines, tracking a more than 2 percent fall in the MSCI Asia-Pacific ex-Japan index, the report added.
"The Wall Street selloff came on account of the release of a report from the Labor department showing much weaker than expected job growth in the month of May. A weaker than expected manufacturing report from China proved to be a precursor to several similar manufacturing reports from countries across Europe. However, the disappointing US employment report appears to have had the largest impact on investors," according to an Angel Broking note.
"Momentum is still weak on hourly charts and is fading away on daily charts. Also, there are no signs of a reversal/slowdown in price action yet. Hence, the current weak tone could extend and push the index further lower towards the recent low of 4,789 and even the chart-gap (10 January) support at 4,749 in the coming 2-3 sessions.
On the higher side, stiff resistance is likely to be seen in the region of 4,867/4,889 (13-hour EMA) on any intraday rallies. Only a move above 4,949 will stall the prevailing weak tone and invite a notable recovery in prices," an Aditya Birla Money report stated.
The BSE Midcap Index was down 1.24 percent and the BSE Smallcap Index was 0.72 percent lower.
Among sectoral indices, the BSE Metal Index was down 1.77 percent, the BSE IT Index was 1.46 percent lower, the BSE Capital Goods Index was down 1.46 percent and the BSE Bankex fell 1.43 percent.
Cairn India (3.82 percent), Jindal Steel (2.70 percent), State Bank of India (2.57 percent), DLF (2.52 percent) and Hindalco Industries (2.49 percent) are among the Nifty losers.
Hero MotoCorp (0.62 percent) and BPCL (0.49 percent) are the only index gainers.
The market breadth was negative on the NSE with 290 gainers against 1,033 losers.
Oil prices were under pressure following concerns of slowing global demand. Brent crude oil fell more than $1 to $97.36 per barrel against its previous close.
Meanwhile, the rupee strengthened against the US dollar after a weak start. The partially convertible rupee was at 55.48 per dollar, up 6 paise against its previous close of 55.54.
Foreign institutional investors sold equities worth Rs 220.38 crore on Friday, according to provisional stock exchange data. (curtsey: economic times)
Rupesh Yatesh Dalal
Head Research Department
Head Research Department
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