Metals drag markets in the red

The Sensex after opening in the green with a 50 points gain quickly lost its ground to slip into the negative due to pressure in the metal space. Currently the Sensex is down 40 points at 19,037 while the Nifty lost 17 points at 5,711. The broader markets were not spared either from the fall. The midcap index gave up 0.1% while the smallcap is flat with a negative bias at 8,442.

Among the sectoral indices, metal index started in the negative, down 2% followed by Oil & Gas, Bankex and Capital Goods losing in the range of 0.4-0.9%. However, the auto index gained 0.6% in the mrning trades.

On the other hand, yesterday, the US stocks had rallied with the Nasdaq up for an eighth straight day and all three major US indexes rising 1% or more, as strong labor market and retail sales data lifted optimism a day before the US employment report for June. The Dow Jones industrial average gained 1 to 12,752. The Standard & Poor's 500 Index gained 1.27%, to 1,356.The Nasdaq Composite Index gained 1.57%, to 2,878.

Back home, the results season will start today with HDFC announcing its first quarter numbers.Analyst are expecting corporate India will report on an average 15% earnings growth. Kartik Mehta, AVP (Equity Research), Sushil Finance expects information technology (IT), banking and fast moving consumer goods (FMCG) sectors to report very healthy numbers, followed by auto and capital goods.

Bharti Airtel up 2% was the top gainer among the Sensex gainers followed by DLF and Tata Motors adding 1% each.HDFC, Bajaj Auto, Mahindra & Mahindra and Hero Honda up 0.6-0.8% were the other notable gainers.

Metal stocks in the Sensex namely Sterlite, Hindalco, Jindal Steel and Tata Steel down 2-3% were the top losers. ICICI Bank, L&T, Hindustan Unilever and Jaiprakash Associates down 0.6-0.8% were the other major losers.The shares of coal mining companies – Coal India and Sesa Goa  plunged more than 8% each after the a 10-member Group of Ministers (GoM) headed by Finance Minister Pranab Mukherjee on Thursday approved the new Mining Bill.

The market breadth is positive. Of the total 1921 stocks traded on the BSE, 1078 stocks have advanced while 771 declined.