Markets trade lower in line with Asian peers; Nifty nears 9,600

The S&P BSE Midcap and the S&P BSE Smallcap indices dipped 0.3% and 0.2%, respectively

The benchmark indices continued to trade lower on Monday ahead of the release of key macroeconomic numbers scheduled for later today, while investors also reacted to GST Council's meeting on Sunday where it reduced the GST rates for 66 items. 

Globally, negative trend in Asian markets ahead of the US Federal Reserve's two-day policy meeting, which begins on Tuesday, also kept the momentum tepid.   

At 12:00 pm, the S&P BSE Sensex was trading at 31,105, down 157 points, while the broader Nifty50 was ruling at 9,619, down 48 points. 

In the broader market, the S&P BSE Midcap and the S&P BSE Smallcap indices dipped 0.4% each. 

"Despite Friday’s short covering, the upmove has not been strong enough to suggest that the flag pattern has matured. This calls for caution against a whispsaw move that could see supports being challenged. Such a construct should see 9,591 or slightly below, but major falls are less likely unless 9,500 gives away," said brokerage Geojit Financial Services in a technical note. 

Sectors and stocks

Nifty PSU Bank index (down 1%) was the leading sectoral loser, led by losses in PNB, Bank of India, SBI and Syndicate Bank which fell 1% each. 

Finance Minister Arun Jaitley is likely to meet heads of public sector banks (PSBs) today to discuss the issue of non-performing assets (NPAs) and the steps being taken by them to expedite the recovery of bad loans that have crossed Rs 6 lakh crore.

Tata Motors slipped over 1% to Rs 459 after the auto major said that its global wholesales including Jaguar Land Rover (JLR) declined by 1% to 86,385 units in May 2017 over May 2016.

Amtek Auto dipped nearly 2% to Rs 34 after the debt ridden auto component maker reported a consolidated loss of Rs 2,533 crore for the year ended March 31, 2017.  

GST rates revised on 66 products

With two weeks to go for the GST roll-out, the GST Council on Sunday reduced the rates for 66 items such as insulin, pickles, printers, agarbattis, school bags, and cashew nuts etc. Those were among 133 items whose rates were reviewed following industry representation.

The Council also expanded the scope of the composition scheme for the benefit of small traders, manufacturers, and restaurateurs. The composition scheme is a presumptive taxation scheme allowing small traders, manufacturers and restaurants to pay a 1-5% GST rate on sales without tax credits. CLICK HERE FOR THE FULL REPORT

IIP, inflation data due today

Consumer Price Index (CPI)-based inflation is expected to have cooled to a new record low in May, a Reuters poll found, which could add pressure on the Reserve Bank of India to cut interest rates later in the year.

The consumer price index likely rose 2.60% in May from a year earlier, dipping from 2.99% in April, due to a fall in the cost of pulses, cereals and perishable goods, according to the poll of 25 economists.

The poll also suggested that industrial output is expected to have risen 3% in April after growing 2.7% in March, mainly due to a revision in the base year to 2011-12 from the previous 2004-05.

US Fed meet

The Fed holds a two-day meeting ending on Wednesday at which it is widely expected to hike interest rates. The focus is on whether the Fed thinks the US economy is robust enough to withstand further rate increases through 2017.

Global  markets

Asian stocks edged lower. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.1% following a mixed day on Friday on Wall Street where the Nasdaq slid 1.8% on tumbling technology shares but the Dow closed at yet another record high.

MSCI's Asia-Pacific index was still in reach of a two-year high scaled late last week.

Japan's Nikkei was down 0.5% and South Korea's KOSPI slid 0.5%. Australian markets were closed for a public holiday.

(With inputs from Reuters)