Sensex trades flat, Nifty below 8,100 after Italy votes 'no' on reform

The euro was under the gun on Monday, skidding to a 20-month low after Italian Prime Minister Matteo Renzi resigned following a stinging defeat on constitutional reform

The benchmark indices were trading flat in Monday’s trade tracking negative Asian cues after Italian Prime Minister Matteo Renzi resigned following a heavy defeat in a referendum over his plan to reform the constitution.

At 10:45 am, the S&P BSE Sensex was trading at 26,188, down 42 points, while the broader Nifty50 was ruling at 8,084, down 3 points. 

"Although last week's high of 8,250.80 would be a daunting task to overcome, we would still expect a possibility of extending this to bounce back to 8,320-8,380 level. On the flipside, 8,055-7,952 would be seen as an immediate support zone this week," said Angel Broking in a technical note. 

Meanwhile, on Friday, foreign institutional investors were net sellers with net equity sell value of Rs 190 crore, while domestic institutional investors also sold equities worth Rs 418 crore, provisional data available with BSE suggested.

Sectors and stocks

HDFC, TCS and Wipro were the top losers on the Sensex and shed up to 3%. 

Dredging Corp tanked over 5% after the company reported poor set of numbers for the September quarter.

Among gainers, KEC International gained nearly 4% after the company said that it won international orders worth of Rs 840 crore of various segments viz. transmission and distribution segment, cable business.

BSE Auto index was the top sectoral gainer and added 1%, led by gains in MRF (2%), BOSCH (1.94%) and Eicher Motors (1.41%).

GST roll-out from April in jeopardy

The Goods and Services Tax (GST) Council failed on Saturday, for the third time in a month, to break the deadlock between the Centre and the states on the control of assessees under the new indirect tax regime. Now, it seems impossible that the GST Bill, scheduled to be placed before Parliament during the ongoing winter session, will be passed. This also casts a shadow on the April 1 deadline for rolling out GST.

Italy votes 'no' on reform

The euro was under the gun on Monday, skidding to a 20-month low after Renzi resigned following a stinging defeat on constitutional reform that could destabilize the country's shaky banking system.

Renzi's defeat deals a body blow to the European Union already reeling under anti-establishment anger that led to the shock exit of UK from the club in June this year.

Investors and Europe's politicians fear victory for the opposition 'No' camp could cause political instability and renewed turmoil for Italy's banking sector, which has been hit by fears over its huge exposure to bad loans built up during years of economic downturn.

US unemployment rate down

US unemployment rate fell to a nine-year low of 4.6% in November, making a December Fed rate hike almost a certainty. 

US non-farm payrolls rose by 178,000 jobs in November against a rise by 142,000 in October, the US Labour Department said on Friday. 

Global markets

New Zealand stocks extended losses to trade 0.6% lower after Prime Minister John Key unexpectedly announced his resignation on Monday, saying it was the "right time" to leave politics.

MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.3%, while E-mini futures for the S&P 500 narrowed losses to 0.2%.

Japan's Nikkei slid 0.5%.

While the long-awaited opening of the Shenzhen-Hong Kong Stock Connect went live on Monday, global risk aversion weighed on China's and Hong Kong's main indices.

China's CSI 300 index tumbled 1.2%. Hong Kong's Hang Seng index reversed earlier losses to trade flat.

(With inputs from Reuters)