Markets continue to trade marginally lower

Financials drag

Markets continue to trade marginally lower weighed down by financials and negative Asian markets. At 11:20am, the BSE Sensex was down 71 points at 17,450 and the Nifty lost 26 points at 5,290. Thus far, the Sensex saw a low of 17,412 and touched a high of 17,486.

Broader markets too were in the negative with the midcap index down 0.7% underperforming the Sensex and the smallcap index down 0.4% each.

Asian shares slumped after sluggish US jobs data deepened worries about slowing global economic growth, and reinforced risk aversion ahead of China inflation figures and a meeting aimed at defining steps to shore up Europe's banks. Japan's Nikkei share average broke the psychologically important 9,000 level in early trade and was down 1.2% along with Shanghai Composite, Hang Seng, Jakarta Composite, Straits and Kospi down 1.3-1.5%.

Back home, IT and FMCG up 0.4% and 0.1% were the only indices in the green. On the other hand, Metal, Capital Goods, Power, Realty and Consumer Durables down 1% each were the major draggers.

The gainers among the Sensex stocks included IT major TCS and Infosys up 1% and 0.3% along with Gail India, ICICI Bank, Tata Motors, Mahindra & Mahindra and ITC which added 0.4-0.8%.

HDFC Bank was down 1.6% on profit taking after the stock gained nearly 7% last week.

Bharti Airtel also witnessed profit taking and was down over 2% after telecom shares surged last week after the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) gave a split verdict on a challenge by mobile phone operators seeking to overturn a government order requiring them to stop offering 3G services beyond their licensed zones through mutual roaming pacts, lawyers said

Jindal Steel, Tata Steel, Maruti Suzuki, HDFC, Hindalco and Tata Power down 1.5-2.5% were the other laggards in the early noon trades.

The market breadth was negative. 1294 stocks declined while 1037 stocks advanced.

Among other stocks, Engineers India gained 5% at Rs 239, after the state-own company said that it has secured Rs 720-crore consultancy services contract from BPCL for the Integrated Refinery Expansion Project, Kochi.

Goenka Diamond and Jewels hit the lower circuit of 20% at Rs 162 on reports that the Intelligence Bureau named the company of illegal manipulation, driving up share prices through the creation of false volumes.

TVS Motor Company added 6% at Rs 39 on reports that the company is in talks with German auto maker BMW AG’s motorcycle division, BMW Motorrad, to source technological know-how for developing high-end motorcycles.