Breadth turns negative; Nifty below 12,000

Key equity market barometers erased early gains and turned negative in mid-morning trade. The Nifty 50 index slipped below 12,000.

Trading sentiment was weak after the Reserve Bank of India (RBI) unexpectedly left interest rates unchanged on Thursday. In a surprise move, the RBI decided to hold the rates after delivering five consecutive rate cuts in 2019. The move was driven by the rising inflationary pressure and gradual improvement in monetary transmission.

RBI revised GDP growth downwards to 5% for 2019-20 from 6.1% projected in its October policy. The CPI inflation projection has also been revised upwards to 4.7-5.1% for the second half of FY20 and 3.8-4% for the first half of FY21.

At 11:27 IST, the barometer index, the S&P BSE Sensex, was down 114.18 points or 0.28% at 40,665.41. The Nifty 50 index was down 35.70 points or 0.30% at 11,982.70.

The S&P BSE Mid-Cap index was down 0.63%. The S&P BSE Small-Cap index slipped 0.42%.

The market breadth turned negative. On the BSE, 826 shares rose and 1196 shares fell. A total of 122 shares were unchanged. In Nifty 50 index, 12 stocks advanced while 38 stocks declined.

Stocks in Spotlight:

Bajaj Finance advanced 0.16% to Rs 3993.95. The NBFC said it participated in qualified institutions placement (QIP) of RBL Bank and have been allotted 42.73 lakh equity shares at a price of Rs. 351 per equity shares aggregating to approximately Rs 150 crore.

V.S.T. Tillers Tractors slipped 0.71% to Rs 1086.15. The company's power tillers sales rose 12.14% to 1238 units in November 2019 from 1104 units in October 2019. It declined 41.27% from 2108 units in November 2018. The total tractor sales slumped 33.72% to 568 units in November 2019 from 857 units in October 2019. It was down 9.55% from 628 units in November 2018.

Foreign Markets:

Overseas, Asian stocks continued to trade higher as traders await news on the US job market and an impending scheduled American tariff hike on Chinese goods.

In US, stocks moved higher on Thursday as investors remained optimistic about prospects for a US-China trade deal despite a looming deadline for the imposition of fresh import tariffs by President Donald Trump.

In economics news, the Labor Department released a report on Thursday showing an unexpected decrease in first-time claims for U.S. unemployment benefits in the week ended November 30th. The report said initial jobless claims slipped to 203,000, a decrease of 10,000 from the previous week's unrevised level of 213,000. With the unexpected decrease, jobless claims fell to their lowest level since hitting 193,000 in the week ended April 13th.

US new orders for manufactured goods rose by 0.3% in October after falling by a revised 0.8% in September, according to a report released by the Commerce Department on Thursday.

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