Concerns over macro data dent markets, Sensex down 470 points (Roundup)

Anxiety over inflation and factory output data, due to be released on Friday, dented investor sentiment and led a key barometer index of the Indian equities markets to plunge nearly 470 points on Thursday.

Not just anxiety over Friday's inflation and factory output data, but also negative cues from a delayed monsoon, the Greek loan default crises, increasing crude oil prices and sales by FIIs (Foreign Institutional Investors) also impacted the markets.

On Thursday, the 30-scrip BSE Sensitive Index (Sensex), closed around 470 points or 1.75 percent down, a day after it broke a six consecutive session of losing streak.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) also closed the day's trade deep in the red. It lost 159 points or 1.96 percent at 7,965.35 points.

The Sensex of the S&P Bombay Stock Exchange (BSE), which opened at 26,959.98 points, closed the day's trade at 26,370.98 points, down 469.52 points or 1.75 percent from the previous day's close at 26,840.50 points.

The Sensex touched a high of 27,000.14 points and a low of 26,348.93 points in the intra-day trade.

According to the Angel Broking, the Indian markets which opened in the positive zone tracking SGX Nifty and its global peers, however, it soon slipped into the negative territory.

Around 9.30 a.m. the Sensex had made gains of over 100 points and was trading at 26,944.14 points.

"The Indian markets reversed their downtrend on Wednesday for the first time in a

week. News of the MSCI (Morgan Stanley Capital International) EM (emerging markets) index deferring enlisting of the Chinese 'A' shares bought relief to the Indian markets," the broking firm said.

There was a possibility that India's weightage in the index may have been reduced, as a result of the entry of Chinese stocks and thus effect capital flows.

On Wednesday, the Sensex, had surged by around 400 points or more than 1.30 percent in the day's trade, after six consecutive sessions of losses.

"After yesterday's sharp bounce-back, markets today have given away most of yesterday's gains. Yesterday's move looked more like short-covering from traders," said Sachin Shah, fund manager and head, Emkay PMS.

"Lack of follow-up buying did not allow the markets to sustain at higher levels. In the first eight sessions of June, FIIs have been net sellers of nearly $ 1 billion in the Indian equities," Shah said.

Vinod Nair, head for fundamental research, Geojit BNP Paribas Financial Services said that: "Today, we have seen profit booking along with reaction towards (expectations) of poor macro numbers. Confidence is poor and we believe market is yet to rationalise earnings growth outlook."

"Tomorrow (Friday), we await May CPI (Consumer Price Index) numbers and consensus stands at 5 percent year-on-year (YoY) vs 4.87 percent in April," Nair said.

During the intra-day trade on Thursday, interest rate sensitive stocks like banking, automobile, capital goods, consumer durables, healthcare, information technology (IT), oil and gas, metal, technology, entertainment and media (TECK) and fast moving consumer goods (FMCG) came under intense selling pressure.

The S&P BSE banking index plunged by 482.64 points, followed by the automobile index which dwindled by 429.62 points, capital goods index plummet by 305.86 points, consumer durables index receded by 207.92 points, healthcare index declined by 200.67 points and IT index fell by 1158.92 points.

The S&P BSE oil and gas index lost 135.11 points, metal index was edged-down by 115.77 points, TECK index was lower by 78.56 points and FMCG index was down by 70.73 points.Only Vedanta's stocks gained in the group of the 30-scrip sensitive index. Vedanta's scrip was up 1.54 percent at Rs.187.70.

The major Sensex losers during Thursday's trade Wednesday were: Tata Power, down 4.88 percent at Rs.70.15; Tata Motors, down 3.61 percent at Rs.430.35; BHEL, down 3.24 percent at Rs.243.25; Reliance Industries, down 3.17 percent at Rs.877.20; and Axis Bank, up 3.10 percent at Rs.546.85.

Among the Asian markets, Japan's Nikkei closed higher by 1.68 percent, China's Shanghai Composite Index rose by 0.32 percent, Hong Kong's Hang Seng was up by 0.83 percent.

In Europe, the London FTSE 100 was higher by 0.25 percent, the French CAC 40 rose by 0.60 percent and the Germany DAX Index was up by 0.77 percent at the closing bell here.