Indices drop sharply in early trade on negative Asian stocks

The domestic benchmarks are trading with sharp losses in early trade, amid significant selling in index pivotals. The Nifty slipped below the 16,750 level. Weak Asian stocks weighed on the sentiment.

At 09:21 IST, the barometer index, the S&P BSE Sensex, was down 885.13 points or 1.55% to 56,126.61. The Nifty 50 index lost 268.65 points or 1.58% to 16,716.55.

Among the Nifty 50 index constituents, JSW Steel (down 4.17%), Tata Motors (down 3.75%), Grasim (down 3.22%), Tata Steel (down 3.21%) and IndusInd Bank (down 3.05%) edged lower.

However, Cipla (up 1.72%) and Wipro (up 0.20%) rose.

In the broader market, the S&P BSE Mid-Cap index slipped 2.51% while the S&P BSE Small-Cap index shed 2.90%.

The market breadth was weak. On the BSE, 603 shares rose and 2063 shares fell. A total of 99 shares were unchanged.

Stocks in Spotlight:

UltraTech Cement slipped 1.76% to Rs 7207. The cement maker said that it has commenced operations from its bulk terminal at Kalamboli, Navi Mumbai. With a capacity to handle ~ 1.2 mtpa cement and considering the large infrastructure development projects in and around Mumbai, the bulk terminal will strengthen the company further to increase its sales of bulk cement.

GAIL (India) declined 1.58% to Rs 127.50. The company said that it entered into a Memorandum of Understanding (MoU) with Gujarat Alkalies & Chemicals for setting up a 500 litre per day bioethanol plant at an estimated investment of Rs 1,000 crore in Gujarat.

Mold-Tek Packaging fell 2.85% to Rs 732.45. The company's QIP committee has determined and approved the issue price of Rs 740 per share for the equity shares to be allotted pursuant to the issue. The issue price is at a 2.44% premium to the floor price of Rs 722.40 per share. The company's board has approved allocation of 14 lakh equity shares to the eligible qualified institutional buyers.

Global Markets:

Asian stocks were trading lower on Monday. China has slashed its benchmark lending rate for the first time in more than one-and-a-half years.

China on Monday announced a cut in its one-year loan prime rate from 3.85% to 3.8% the first such move since April 2020.

Wall Street finished lower on Friday, weighed down by Big Tech as investors worried about the Omicron coronavirus variant and digested the Federal Reserve's decision to end its pandemic-era stimulus faster.

In Europe, the Netherlands went into lockdown from Sunday till at least January 14 amid fears that its healthcare system will become overburdened in January. Elsewhere, Britain has also been seeing a surge in Covid infections.

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