Markets remain volatile in narrow range, Metals drop

BSE Metal and Oil & Gas indices have tumbled between 2-3%

Benchmark indices remain volatile in a narrow range with Sensex and Nifty hovering around 18,300 mark and 5,400 levels, respectively.

Sentiments turned jittery after the Prime Minister Manmohan Singh said that the rupee's tumble is a "matter of concern" but is part of a needed adjustment due to India's large current account deficit.

Singh said that rupee depreciation will see upward pressure on inflation, but added that RBI will work on containing it.

He said that the government will now have to undertake more difficult reforms, including reduction of subsidy and implementing GST, to put economy back on the path of stable, sustainable growth.

At 14:25 PM, the 30-share Sensex dropped 26 points at 18,375 and the 50-share Nifty shed 18 points at 5,391 levels.

The key trigger for markets now will be first quarter GDP data and the fiscal deficit data for April-July scheduled later today.

Moody's Analytics, the research and analysis wing of Moody’s expects the Gross Domestic Product (GDP) growth for the first quarter to be at 4.5%.

Meanwhile, the Finance Minister P Chidambaram has already said that the Centre's fiscal deficit at 4.8% of GDP in the current financial year is a red line which will not be breached.

On the global front, Asian stocks rose and oil prices tumbled as a possible U.S. military strike on Syria appeared less likely, while the dollar remained not far from a three-week high against a basket of currencies after upbeat U.S. growth data.

Back home, the rupee slid back towards a record low on Friday, with investors braced for a statement on the state of economy from Prime Minister Manmohan Singh and the release of data that was expected to show India in the grip of a protracted slowdown.

Weak economic growth, a record high current account deficit and concerns about the government's finances are proving a toxic mix for the rupee, which hit a record low of 68.85 on Wednesday after falling around 20 percent since May.

On the sectoral front, BSE Metal and Oil & Gas indices have tumbled between 2-3% followed by counters like Realty, Power, PSU, Auto and Capital Goods, all falling down by 1% each. However, BSE IT, Consumer Durables and Bankex indices are trading marginally in green.

Jindal Steel is the top Sensex loser, down over 8% on report that the Coal Ministry has set up a probe panel to review the status of Naveen Jindal-promoted company’s two coal blocks in Chhattisgarh.

Other notable losers are Hindalco, Tata Motors, Sesa Goa, Tata Power, Coal India, ONGC, Bharti Airtel, Infosys and RIL, all declining between 2-4%.

On the gaining side, Cipla, TCS, Bajaj Auto, Hero Moto and Wipro have gained between 2-4%.

Wipro has hit a 52-week high on Friday as analysts foresee better growth prospects for the company.

The market breadth in BSE remains negative with 1,111 shares declining and 1,001 shares advancing.