Market extends initial losses

Key benchmark indices extended initial slide and hit fresh intraday low in morning trade as weakness in Asian stocks weighed on sentiment. At 10:20 IST, the barometer index, the S&P BSE Sensex was down 245.07 points or 0.95% at 25,545.15. The Nifty 50 index was currently down 70.20 points or 0.89% at 7,830.20. The latest data showing that consumer price inflation surged in April has lowered hopes of further policy rate cuts by the Reserve Bank of India affecting market sentiment adversely.

The Sensex dropped 274.21 points or 1.06% at the day's low of 25,516.01 in morning trade, its lowest level since 11 May 2016. The barometer index lost 46.53 points or 0.18% at the day's high of 25,743.69 at the onset of the trading session. The Nifty, shed 80.20 points or 1.01% at the day's low of 7,820.20 in morning trade, its lowest level since 11 May 2016. The index fell 19.40 points or 0.24% at the day's high of 7,881 at the onset of the trading session.

In overseas stock markets, Asian stocks dropped as crude oil retreated and technology shares declined after Apple Inc. sank to the lowest since June 2014. US stocks closed mostly lower yesterday, 12 May 2016 weighed by declines in health care and technology stocks.

Closer home, the market breadth indicating the overall health of the market was weak. On BSE, 998 shares fell and 655 shares rose. A total of 86 shares were unchanged. The BSE Mid-Cap index was currently down 0.02%. The BSE Small-Cap index was currently down 0.03%. The fall in both these indices was lower than the Sensex's decline in percentage terms.

IT stocks declined. Tech Mahindra (down 0.59%), TCS (down 0.89%), Infosys (down 1.15%), and Wipro (up 0.57%) declined. HCL Technologies rose 0.53%.

Auto stocks declined after the latest data showed that consumer price inflation surged in April lowering hopes of further rate cuts by the Reserve Bank of India. Mahindra & Mahindra (M&M) (down 1.37%), Ashok Leyland (down 0.38%), Maruti Suzuki India (down 0.47%), Eicher Motors (down 3.11%), Hero MotoCorp (down 1.23%), Bajaj Auto (down 1.34%) and TVS Motor Company (down 0.22%) declined. Tata Motors rose 0.46%. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.

Bank of Maharashtra fell 2.36% to Rs 29 after the bank reported net loss of Rs 119.84 crore in Q4 March 2016 compared with net profit of Rs 112.72 crore in Q4 March 2015. The result hit the market at the fag end of trading session yesterday, 12 May 2016. The stock remained flat at Rs 29.70 yesterday, 12 May 2016. Bank of Maharashtra's gross non-performing assets (NPA) stood at Rs 10385.85 crore as on 31 March 2016, as against Rs 8301.62 crore as on 31 December 2015 and Rs 6402.06 crore as on 31 March 2015. The ratio of gross NPA to gross advances stood at 9.34% as on 31 March 2016, as against 7.97% as on 31 December 2015 and 6.33% as on 31 March 2015. The ratio of net NPA to net advances stood at 6.35% as on 31 March 2016 as against 5.52% as on 31 December 2015 and 4.19% as on 31 March 2015. The bank's provisions and contingencies rose 57.32% to Rs 679.51 crore in Q4 March 2016 over Q4 March 2015.

Kokuyo Camlin slumped 8.53% after net profit fell 45.5% to Rs 2.36 crore on 8.5% rise in net sales to Rs 176.81 crore in Q4 March 2016 over Q4 March 2015. The company declared its results after trading hours yesterday, 12 May 2016.

Among macro data, inflation based on consumer price index (CPI) surged to 5.39% in April 2016 from six months low of 4.8% recorded in March 2016. The corresponding provisional inflation rate for rural area was 6.09% and urban area 4.68% in April 2016 as against 5.70% and 3.95% in March 2016. The core CPI inflation rose to 4.76% in April 2016 from 4.54% in March 2016.

Industrial production (IIP) growth moderated to 0.1% in March 2016 over March 2015 compared with 2% growth recorded in February 2016. The electricity generation surged at double-digit pace of 11.3% in March 2016. However, the mining output declined 0.1% and manufacturing production dipped 1.2% contributing to the overall slower growth in industrial output in March 2016. Both, CPI and IIP data were announced after market hours yesterday, 12 May 2016.

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