Sensex, Nifty hit fresh intraday low

Key benchmark indices trimmed losses after hitting fresh intraday low in mid-morning trade. At 11:20 IST, the barometer index, the S&P BSE Sensex, was down 69.27 points or 0.20% at 34,779.03. The Nifty 50 index was down 30.15 points or 0.28% at 10,566.25.

After starting on a weak note, the market bounced back for a brief period in morning trade. Gains were unable to sustain at higher levels and the indices slipped into negative terrain in morning trade. Indices slipped further in mid-morning trade. The Sensex rose 125.65 points, or 0.36% at the day's high of 34,973.95 in morning trade. The index fell 105.31 points, or 0.30% at the day's low of 34,742.99 in mid-morning trade. The Nifty rose 25.30 points, or 0.24% at the day's high of 10,621.70 in morning trade. The index fell 46.35 points, or 0.44% at the day's low of 10,550.05 in mid-morning trade.

Among secondary barometers, the BSE Mid-Cap index was down 0.99%. The BSE Small-Cap index was down 1.39%. Both these indices underperformed the Sensex.

The market breadth, indicating the overall health of the market, was weak. On BSE, 686 shares rose and 1594 shares fell. A total of 100 shares were unchanged.

IT shares were mixed. Persistent Systems (down 1.39%), Oracle Financial Services Software (down 0.9%), MphasiS (down 0.87%), Wipro (down 0.76%), Tech Mahindra (down 0.22%) and Infosys (down 0.06%), edged lower. Hexaware Technologies (up 0.13%), HCL Technologies (up 0.25%), TCS (up 1.99%) and MindTree (up 2.41%), edged higher.

Most pharmaceutical shares declined. Strides Shasun (down 6.74%), IPCA Laboratories (down 4.29%), Sun Pharmaceutical Industries (down 2.25%), Dr Reddy's Laboratories (down 1.71%), Wockhardt (down 1.48%), Cipla (down 1.14%), Alkem Laboratories (down 1.13%), GlaxoSmithKline Pharmaceuticals (down 1.05%), Divi's Laboratories (down 0.74%), Lupin (down 0.23%) and Aurobindo Pharma (down 0.18%), edged lower. Glenmark Pharmaceuticals (up 0.31%), Cadila Healthcare (up 0.42%) and Piramal Enterprises (up 1.11%), edged higher.

Engineering and construction major L&T was up 0.80% to Rs 1,326.55. L&T Hydrocarbon Engineering (LTHE), a wholly-owned subsidiary of L&T, in consortium with TechnipFMC, has won two significant orders from Hindustan Urvarak and Rasayan Limited (HURL), a joint venture company of IOCL, NTPC, CIL, FCIL and HFCL.The engineering, procurement, construction and commissioning (EPCC) contracts are for setting up two fertilizer plants of 2,200 TPD Ammonia & 3,850 TPD Urea at Barauni (Bihar) and Sindri (Jharkhand). The plants will be based on world-renowned ammonia technology of Haldor Topsoe, Denmark and urea technology of Saipem, Italy. LTHE scope of work, worth in excess of Rs 3800 crore, consists of two 2,200 TPD Ammonia plants. The announcement was made during trading hours today, 21 May 2018.

On the political front, the much-awaited Karnataka floor test ended in an anti-climax of sorts with BS Yeddyurappa, who took oath as the Chief Minister on Thursday, 17 May 2018, resigned on Saturday, 19 May 2018, after he failed to secure the magic number of 112 required to form the government. Janata Dal (Secular) leader HD Kumaraswamy will now be sworn in as Chief Minister on Wednesday, 23 May 2018.

HD Kumaraswamy will reportedly be meeting former Congress president Sonia Gandhi and Congress president Rahul Gandhi in Delhi today, 21 May 2018, to discuss the modalities of government formation.

Overseas, most Asian shares were trading higher as weekend developments in the US-China trade relationship were digested by investors.

The US trade war with China is on hold after the world's largest economies agreed to drop their tariff threats while they work on a wider trade agreement, US Treasury Secretary Steven Mnuchin reportedly said on Sunday. Mnuchin and US President Donald Trump's top economic adviser, Larry Kudlow, said the agreement reached by Chinese and American negotiators on Saturday set up a framework for addressing trade imbalances in the future, reports added.

US stocks closed mostly lower on Friday, 18 May 2018, as investors grappled with lingering uncertainty over trade negotiations between the US and China, as well as bond yields that climbed this week to the highest level since 2011.

A focus for global markets this week is Wednesday's release of minutes from the Federal Reserve's latest monetary policy meeting. Investors will be watching the minutes for clues about the pace of the current tightening cycle.

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