Markets have a muted start; Sensex hovers at 28,350

Reliance Industries is witnessing mild profit-booking post Q4 results.

The markets have started the new week on a quiet note due to the mixed cues from their Asian market counterparts.

At 9:40AM, the Sensex is at 28,369, lower by 72 points and the Nifty is at 8,586, down 19 points. The midcap and smalllcap indices have shed 0.5% each at 10,710 and 11,558 respectively.

The markets had run out of steam last week, with the Sensex dropping 437 points or 1.5% to end at 28,442 and Nifty shedding 174 points or 2% at 8,606 after investors trimmed positions in information technology shares amid weak revenue growth. This morning's proceeding, thus far, should therefore qualify as a decent start. And the fact that the Asian cues are not very enthusing is noteworthy.

Reliance Industries is witnessing profiot-booking after the announcement of its numbers. The company reported a record quarterly profit at Rs 6,381 crore, driven by the refining business. Gross refining margins for the March quarter increased to $10.1 a barrel (bbl) against $7.3 a bbl in the December quarter and $9.3 a bbl in the year-ago period.

Meanwhile, foreign institutional investors were net sellers in equities to the tune of Rs 676 crore.

ECONOMY

India's trade deficit widened to a four-month high of $11.79 billion in March from $6.85 billion in February and $10.95 billion in March last year. This might have some impact on the country’s current account deficit for the March quarter. Merchandise exports contracted sharply by 21.06% in March.

GLOBAL MARKETS

Asian stock markets were trading subdued on Monday, tracking losses on Wall Street over the weekend even as China's central bank, the People's Bank of China on Sunday announced the reduction of the reserve-requirment ratio by 1% effective from today, infusing liquidity in the system. China's benchmark Shanghai Composite was up 0.6% while Hong Kong's Hang Seng was trading flat. Meanwhile, investors continued to book profits in Japan with the Nikkei trading flat with negative bias while Straits Times was down 0.4%.

US stocks ended over 1% lower on Friday as investors trimmed positions after China imposed new trading regulations while fresh concerns emerging from Greece also dampened sentiment. Further, lower-than-expected revenue from global financial major American express. The Dow Jones industrial average dropped 1.5% to 17,826.30, the broader S&P 500 slipped 1.1% to close at 2,081.18 and the Nasdaq Composite ended down 1.5% at 4,931.81.

SECTORS AND STOCKS

The BSE oil index is subdued, down less than half a percent, post the RIL numbers. RIL has rebounded from its intra-day lows of Rs 913, but is still down 0.3% at Rs 923. It may be recollected that the stock had rallied 16.5% from its 52-week low of Rs 796 touched on March 30, 2015 ahead of its numbers and this morning's sluggishness would suggest that the participants are taking some profits off the table. Among the others tocks in this space, Oil India has lost 1% at Rs 508, while ONGC and Gail have lost about half a percent each.

The BSE IT index continued to be in the doldrums post the TCS numbers, shedding another 1.5% at 11,006. TCS has shed 1.1% at Rs 2448, whil Infosys and Tech Mahindra have shed around a percent each.

On the stock-specific front, the IT stocks are not seeing any respite in selling pressure post the TCS numbers. TCS has shed 1% at Rs 2,450 to top the loser's list on the BSE and Infosys is also down 1% at Rs 2,157. M&M and Bharti Airtel are the other major losers on the bourses.

NMDC is down over nearly 4% at Rs 129 on the Bombay Stock Exchange after the state-owned mining major announced reduction in iron prices. The company has reduced prices of iron ore fines by 20% or Rs 500 per tonne to Rs 1,960 per tonne and lump ore prices by 6.1% or Rs 200 per tonne to Rs 3,050 per tonne.

On the other hand, Tata Steel has jumped 1.3% at Rs 350 to top the gainer's list on the BSE. Hindalco, NTPC and ICICI Bank have added around a per cent each.