Negative bias prevails, L&T and BHEL dip 2%

Markets continue to trade with a negative bias amidst volatility and the Sensex and Nifty hovering around 15,300 mark and 4,600 levels respectively. 

By 1120 hrs, the Sensex was down 64 points at 15,315 and the 50-share Nifty slashed down 21 points at 4,592.

On the global front, US and European shares retreated on Monday and the euro slipped as investors cast doubt on efforts to tighten fiscal rules in the euro zone that aim to prevent the region's debt crisis from deepening.

Asian markets are trading marginally higher. Asian stocks rose after Federal Reserve Bank of Richmond President predicted the US economy will grow 2-2.5% next year.

Back home, BSE Capital Goods, Realty and Metal indices are leading the downslide, tumbling down by nearly 2% each.

Selling pressure is seen in index heavyweight Reliance Industries along with L&T, SBI, Bharti Airtel and ICICI Bank. 

In the capital goods sector, majors like L&T and BHEL have plummeted 2% each after recent data showed sharp contraction in industrial output.

Banking major SBI is down 1% at Rs 1,631. ICICI Bank is trading slightly lower. However, HDFC Bank has surged 1%.

Shares of commercial vehicle maker Tata Motors fell 2% on profit booking after a rally of 4.4% seen yesterday.

However, ITC and ONGC have bucked the weak trend gaining 1.5% each.

Among other shares, Mahindra Satyam has zoomed on merger (with Tech Mahindra) buzz.

SKS Microfinance has gained as the RBI on Monday allowed MFIs to raise up to $10 mn through external commercial borrowings (ECBs), as against the earlier limit of $5 mn, a move that will widen their fund raising sources.

Network 18 has spurted 14% on reports that Mukesh Ambani is in talks to buy stake in the company.

However, UCO Bank has crashed 4% on reports that the bank may reschedule loans of power companies in Haryana.

Orchid Chemicals has rebounded after sharp fall yesterday and was up 6%.

The broader indices too are witnessing weak movement – BSE Midcap and Smallcap indices are down 1% each.

The market breadth in BSE remains unhealthy with 757 advancing and 1,418 shares declining.