Auto stocks in demand

Lacklustre trading continued in mid-afternoon trade. At 14:20 IST, the barometer index, the S&P BSE Sensex, was down 13.57 points, or 0.04%, at 35,608.57. The Nifty 50 index was down 2.30 points, or 0.02%, at 10,815.40. Sentiment was fragile due to negative global cues. Risk appetite in the global market turned weak after US President Donald Trump cranked up trade tensions by going ahead with tariffs on Chinese imports, prompting Beijing to immediately respond in kind.

Among secondary barometers, the BSE Mid-Cap index was down 0.11%. The BSE Small-Cap index was down 0.59%. Both these indices underperformed the Sensex.

The market breadth, indicating the overall health of the market, was weak. On BSE, 914 shares rose and 1610 shares fell. A total of 133 shares were unchanged.

Auto stocks were in demand. Eicher Motors (up 2.35%), TVS Motor Company (up 2.02%), Tata Motors (up 1.80%), Bajaj Auto (up 1.14%), Mahindra & Mahindra (up 0.86%), Maruti Suzuki India (up 0.68%), Hero MotoCorp (up 0.10%) and Escorts (up 0.06%), edged higher. Ashok Leyland was down 1.86%.

Most power generation stocks declined. Torrent Power (down 4.44%), JSW Energy (down 2.01%), Adani Power (down 1.9%), CESC (down 1.22%), Tata Power (down 1.12%), NHPC (down 0.97%), Reliance Power (down 0.72%) and Jaiprakash Power Ventures (down 0.31%), edged lower. Reliance Infrastructure (up 0.21%), GMR Infrastructure (up 0.63%) and NTPC (up 0.96%), edged higher.

State-run Coal India was down 1.54%. State-run Power Grid Corporation of India was up 0.03%.

Overseas, European and Asian shares fell as investors digested the escalation in trade tensions between the US and China after both countries announced tariffs last week. Markets in China, Hong Kong, Taiwan and Indonesia were closed on Monday for holidays.

Japan logged its first trade deficit in three months in May on a surge in imports of aircraft and aircraft engines from the United States, data from Japan's finance ministry showed Monday. Japan posted a trade deficit of 578.3 billion Yen in May.

Trump administration last week said it will impose a 25% tariff on a list of 818 items of Chinese goods worth around $34 billion beginning 6 July. Measures affecting an additional 284 products worth $16 billion will be subject to review before taking effect.

In response, China said a 25% tariff will be implemented on US goods, including soybeans and electric vehicles, worth $34 billion starting 6 July. Another list of US imports worth $16 billion will be subject to review before being applied.

US stocks ended lower on Friday, but well off the lows of the sessions as investors looked past signs of escalating Washington-Beijing trade tensions.

On the data front, the Empire State manufacturing survey rose 4.9 points in June to a reading of 25, the highest reading since October. Separately, manufacturing production declined 0.7% in May, while capacity utilization dropped to 77.9% from 78.1% in the previous month. Further, the University of Michigan's gauge of consumer sentiment rose to 99.3 in June.

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