Sensex, Nifty sink in negative zone

Stocks erased early gains and hit intraday low in negative zone in morning trade. At 10:16 IST, the barometer index, the S&P BSE Sensex, was down 43.18 points or 0.12% at 35,117.18. The Nifty 50 index was off 19.70 points or 0.18% at 10,719.65. Metal and mining stocks declined. Telecom stocks saw mixed trend.

Domestic stocks edged higher in early trade as trading resumed after a holiday yesterday, 1 May 2018, on account of Maharashtra Day.

The S&P BSE Mid-Cap index was off 0.17%, underperforming the Sensex pack. The S&P BSE Small-Cap index was off 0.04%, outperforming the Sensex.

The market breadth, indicating the overall health of the market, turned negative from positive in morning trade. On the BSE, 1,010 shares fell and 998 shares rose. A total of 95 shares were unchanged. Breadth was strong in early trade.

Overseas, Asian stocks were mixed as investors await the Fed's view on interest rates, inflation, and the economy. US stocks closed mostly higher yesterday, 1 May 2018 as a sharp rally in technology stocks helped the S&P 500 and the Nasdaq shake off an early decline. However, the Dow fell for a third straight session as caution remained high ahead of the conclusion of a Federal Reserve policy meeting and fresh developments in global trade.

The US Federal Reserve began a two-day meeting yesterday, 1 May 2018. The central bank is reportedly likely to leave interest rates on hold. Investors are watching closely for any signals that policy makers will raise interest rates another three times this year.

Meanwhile, US President Donald Trump late Monday gave top allies - the European Union, Canada and Mexico - an extension to the tariff exemption to allow more time negotiate a new pact to avoid the levies. The tariffs of 25% on steel and 10% aluminum- already in effect against China, Russia, Japan and others - were slated to come into effect on 1 May 2018, but have now been pushed back to 1 June 2018.

Back home, metal and mining stocks declined. Hindustan Zinc (down 4.37%), Vedanta (down 2.18%), JSW Steel (down 0.54%), Tata Steel (down 0.96%), Steel Authority of India (Sail) (down 0.64%), National Aluminium Company (down 0.93%), Jindal Steel & Power (down 1.59%), Hindalco Industries (down 1.15%) and Hindustan Copper (down 0.48%) edged lower. NMDC (up 0.64%) rose.

Telecom stocks saw mixed trend. MTNL (up 0.78%), Tata Teleservices (Maharashtra) (up 0.71%) and Reliance Communications (up 14.43%) rose. Bharti Airtel (down 0.72%) and Idea Cellular (down 0.29%) fell.

Shares of Bharti Infratel rose 0.43%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.

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