Sensex opens below 28,000 on weak Asian cues; Shanghai dips 4%

Sensex opened at 27,905 levels, down by 266 points while Nifty fell below 8,500 to open at 8,427, down by 83 points.

Benchmark indices opened the session on a downward spiral following weak cues from the global markets.

The 30-share Sensex was at 27,952 levels, down by 219 points or 0.8% while 50-share Nifty fell below 8,500 to open at 8,445, down by 65 points.

The broader markets are, however, outperforming their larger peers with BSE Midcap and Smallcap indices down by 0.36% each. The market breadth is negative with 912 declines against 450 advances on the BSE.

The Chinese stock market crisis would be in focus today with Greece woes lingering in the background. The Greek saga continues with the Greek government getting another lifeline. Athens now has to submit a set of proposals by Sunday, failure of which could make ‘Grexit’ a more likely scenario. And there has been a selloff in China following a move by the Chinese regulator to tighten margin trading and short selling rules, thereby making it difficult for investors to borrow money to play the market.

On the home front, the first quarter results season, which will start this Thursday and the Index of Industrial Production data (IIP) scheduled for this Friday would be in focus.

On the currency front, the rupee opened at 63.58, depreciating by 12 paise against the US dollar.

CRUDE OIL

Oil futures steadied early on Wednesday on an expected drop in US inventory, but worries over the Greek debt crisis and China's stock market turmoil dragged on prices.

GLOBAL MARKETS

Asian markets tumbled due to a plunge in the Chinese stocks, rattling investors’ confidence that is already wary about Greece crisis.

Shanghai's benchmark composite index was down 6.4% despite support measures from Beijing.

The drop in China extended in today’s trading session has clipped 30% off Chinese shares since mid-June, threatening a new blow to the country's already slowing economy.

Chinese media reported that possibly more than half of China's listed companies have suspended or will seek trading suspensions in an attempt to escape the market rout.

Japan's Nikkei stock index fell 1.5% while SGX Nifty was down by 1% in the morning trades.

Meanwhile, investors are wary of the Greece crisis. The euro was down about 0.2%. US stock futures were down 0.6% but Wall Street’s major indices closed higher amid the Greek and Chinese crisis.

SECTORS & STOCKS

Sectorally, all sectors are trading in red with BSE Metal has taken a major hit as it dips 1.6% followed by BSE Auto and Bankex indices, down by 1.1-1.2%.

Base Metal prices have crashed on Tuesday as the dollar became stronger following Greece cues. Vedanta has slumped nearly 4% on the Sensex while Tata Steel is down by 2.3%. Hindalco has slipped 3.1%.

From the Auto pack, Tata Motors has shed 4% while Maruti, M&M and Hero Motocorp have shed between 0.2-0.9% each.

Banking shares are trading down with Bank Nifty shedding over 200 points or 1.09% amid Greece and Chinese crisis. HDFC twins, SBI, Axis Bank, ICICI Bank have all shed between 0.7-1.4% on the Sensex.

Other major laggards are Reliance Industries, ITC, NTPC, BHEL , all down between 0.6- 1.5% each on the Sensex.

On the flip side, HUL has gained 1.9% on the Sensex and is the highest gainer. Cipla has gained 0.67% while Dr. Reddy’s is up by 0.12% on the Sensex.

With Reuters input