Markets turn flat after positive start, Infosys surges 7%

Markets have turned flat after making a positive opening led by strong upmove in Infosys shares. Infosys is in action after co-founder NR Narayana Murthy was re-inducted into the company's board as executive chairman and additional director.

By 9:35, the Sensex is flat at 19,759 levels whereas the Nifty slipped by 9 points at 5,977 mark.

On the global front, benchmark US share indices ended over 1% lower amid selling pressure in late trades on Friday. The Dow Jones Industrial Average ended down 209 points or 1.4% at 15,116. S&P 500 ended down 24 points or 1.4% at 1,631 and Nasdaq Composite ended down 35 points at 3,456.

Asian shares began the new month with a cautious tone on Monday as uncertainty over how much longer the current US stimulus would continue prompted investors to book profits from recent highs and pulled global equities lower.

MSCI's broadest index of Asia-Pacific shares outside Japan remained pressured, after falling to its lowest in nearly seven weeks on Friday and ending May down 4.7 % for its worst monthly performance in a year.
 
Australian shares were down 0.2% while South Korean shares opened down 0.4%.
 
Even Japan's Nikkei stock average, which has outperformed the Asian bourses, eased, opening down 1.6 % and hit a six-week low early on Monday.

China's factory activity shrank for the first time in seven months in May as both domestic and external demand softened, while growth in the services sector cooled, pointing to slowing momentum in the world's second-largest economy.  

The HSBC/Markit Purchasing Managers' Index (PMI) for May fell to 49.2, the lowest level since October 2012 and down from April's final reading of 50.4.   The figure was slightly lower than a preliminary reading of 49.6 released on May 23. Fifty divides expansion from contraction compared with the month before.  

Back home, BSE IT index has spurted by over 3%. However, BSE Auto and Power indices have declined by over 1%.

Shares of Infosys were up over 7% at Rs 2,578 in early morning deals after the board on Saturday appointed NR Naryana Murthy as executive chairman for a period of five years.

This is the first time in corporate India that a retired chairman has been called back to head the same company in an executive capacity.

Other notable gainers are Wipro, Coal India, Bharti Airtel, GAIL and SBI.

On the losing side, Maruti Suzuki has slipped by over 3%. The company reported 14% drop in total sales for the month of May.

Other losers are Bajaj Auto, Tata Motors, NTPC and Hero Moto.

The market breadth in BSE remains marginally positive with 491 shares advancing and 439 shares declining.