Markets May Open Lower On Weak Global Cues
A benchmark index of Indian equities markets sold off sharply in late trade on yesterday and Sensex slipped below the 28,000 mark after record highs for the third consecutive day. The Sensex discard 130 points i.e. 0.46% to settle at 28,032.85 and Nifty closed lower by 4.60 points i.e. 0.52% at 8,382.30 points. Total market breadth turned negative as 1,840 stocks finished in red, 1,216 stocks closed in green while 95 ruled steady. Total turnover rose further to Rs 3,848.52 crore from Rs 3,657.51 crore yesterday.
Nifty broke its vital support level of 8,400 while Sensex too slid perilously close to the 28,000 mark. Major losers that pulled down Sensex and Nifty from record highs included Tata Motors, Reliance, Sun Pharma, ONGC, ITC and SBI. However, 2.3-5% gains in HUL, HDFC, Dr Reddys Labs, HCL Tech and Larsen & Toubro limited the index's fall in the red zone. Mid-cap and small-cap companies also fell on late profit-booking by wary retail investors. The BSE Mid-Cap index declined 64.70 points (0.63%) to settle at 10,210.60. The BSE Small-Cap index drop 74.61 points (0.65%) to settle at 11,368.55. Both these indices underperformed the Sensex.
Yesterday, US stock market was edging lower in early trading and later on briefly jumping up right after the release of the minutes from the Federal Reserve's October meeting. The major indexes slightly below the all time high closes set a day earlier as the Dow Jones industrial average closed down a scant two points (0.01%) to 17,685.73. Down by 0.2% was the S&P 500, which settled at 2048.72; the Nasdaq composite lost 0.6% to 4675.71.
The minutes released Wednesday showed that the Fed decided not to alter its wording on the timing of any interest rate increases until it begins seeing wage inflation pick up. Fed officials worried that a change could be misinterpreted by financial markets.
European shares ended flat after hitting a seven-week high earlier on Wednesday, with investors trading cautiously ahead of minutes from the most recent Federal Reserve policy meeting and Ukraine tension. Across Europe, Germany's DAX rose 0.17% and France's CAC was up 0.09%.
Asian market turned lower on key economic data from Japan and China. Japan's exports rose above expectations by 9.6% in October from a year ago, which was the fastest pace since February. That compared to a 6.9% Y-o-Y rise in September. While, The flash HSBC/Markit manufacturing purchasing managers' index (PMI) fell to a six-month low of 50.0 from 50.4 in October and well below the market estimates of 50.3. Japan's Nikkei 225 erased early gains and currently trading flat at 17,3002. The yen traded at 118.17 per dollar after slumping to 118.27, its weakest level since August 2007. Hang Seng Index is down for a fourth day and currently trading at 0.11% lower. The Shanghai Composite Index dropped 0.2% today. The SGX Nifty is open in green with up by 0.12%. Today we expect Indian equities open lower on global cues.