Sensex down over 50 points; BSE Midcap index falls 2%

Benchmark indices continue to trade lower, amid weak Asian cues, as investors booked profits on concerns over lower industrial growth in June and rising consumer price inflation in July. Further, weak first quarter earnings from state-owned engineering major BHEL also weighed on investor sentiment.

At 13.10 PM, the 30-share Sensex was down 52 points at 25,829 and the 50-share Nifty dipped by 21 points to trade at 7,706.

Asian shares weakened after China's economy showed further signs of softening in July despite a burst of government stimulus measures, suggesting more policy support may be needed to keep growth on track.

An encouraging performance from factories, where output for July met market forecasts, was offset by less buoyant activity for investment and retail sales, where growth was not as strong as expected, while the cooling property market showed further signs of deterioration.

Data earlier on Wednesday showed the amount of money flowing into China's economy slowed to the lowest level in nearly six year, adding to worries about the outlook.

Foreign portfolio investors (FPIs) bought shares worth a net Rs 370.83 crore on Tuesday, 12 August 2014, as per provisional data from the stock exchanges.

Meanwhile, Nomura has raised the BSE Sensex target to 30,310 by end of August 2015. The target implies a 17% gain from Tuesday's BSE closing level.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 61.235, compared with its close of 61.085 on Tuesday.

SECTORS & STOCKS

BSE Realty index has plummeted by over 4% followed by counters like Capital Goods, Power, Metal, Consumer Durables and Auto, all slipping between 1-3%. However, BSE FMCG and IT indices have gained by 1% each.

Shares of real estate and banking sectors are under pressure, falling by up to 6% on the bourses, after retail inflation as measured by the Consumer Price Index (CPI) accelerated to 7.96% in July from 7.46% in June. Therefore, Reserve Bank of India (RBI) is likely to maintain a cautious stance in the next policy too.

Unitech, Indiabulls Real Estate, Housing Development and Infrastructure (HDIL) and DLF from real estate sector are down 3-7% on the National Stock Exchange (NSE). Canara Bank, Federal Bank, Bank of Baroda and Bank of India from the banking space down 3% each.

The main losers on the Sensex are BHEL, Hindalco, Coal India, Tata Power, L&T, SBI, Tata Steel, Axis Bank and ONGC.

BHEL has slumped nearly 7% after April-June earnings lag estimates. Citi warns earnings imply BHEL's backlog may have dipped below 1 trillion rupees (16.33 billion U.S. dollar) for the first time since April-June 2009.

Jaiprakash Associates tanked after the company posted a net loss of Rs 80.6 crore in the quarter ended June 2014. Meanwhile, the company had reported a profit of Rs 334.51 crore.

On the gaining side, HUL, ITC, Sun Pharma, HDFC and TCS have gained between 1-2%.

Broader markets are underperforming the benchmark indices- BSE Midcap and Smallcap indices have plunged by nearly 2%.

The market breadth in BSE remains dismal with 1,863 shares declining and 776 shares advancing.