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Markets on Monday opened on a flat note, after Asian equities sent out mixed cues. At 9:30 a.m., the 30-share Sensex was flat at 27,829, while the Nifty dipped 2 points to 8,432.
Analysts expect the Reserve Bank's Monetary Policy review on Tuesday to set the tone for the markets this week. On the macro front, HSBC manufacturing PMI and service PMI data is scheduled on June 1 and 3, respectively.
On the macro-economic front, India's gross domestic product (GDP) grew 7.3% in 2014-15, slightly less than the advance estimate of 7.4%.
"Due to Friday’s smart up move, the Nifty has bounced back beyond the 8400 mark, which was quite unexpected for us. However, considering the weekly downtrend, we do not want to get carried away by this move. Probably, the Nifty has entered a zone of uncertainty. Thus, we would now closely track Nifty’s price action around 8500 – 8550 levels if it manages to extend Friday’s rally," points out a morning note from Angel Broking.
"On the lower side, 8270 would now be an immediate support for the index. A sustainable move below this level may result in an immediate correction towards 8180 – 8120 levels. Going forward, we advise traders not to trade aggressively until they get clear direction and it’s advisable to follow strict stop losses," it adds.
Meanwhile, foreign portfolio investors bought shares worth a net Rs 2,284.30 crore on Friday, as per provisional data.
GLOBAL MARKETS
Nikkei share average fell on Monday morning, imperilling an 11-day winning streak, after US stocks languished as weak economic data dented investor sentiment, triggering profit-taking on exporters.
But losses were limited after strong Japanese corporate spending data supported the mood, with the Nikkei benchmark not moving away much from its 15-year highs.
The Nikkei fell 0.3% to 20,495.73 in mid-morning trade. During its win streak that reached 11 days on Friday, it gained 5.1%.
US stocks closed lower on Friday as data showed the economy contracted in the first quarter but indexes still posted gains for the month. Transportation shares also weighed on the market, extending recent losses. The Dow Jones transportation average fell 0.8%, putting it just shy of correction territory, almost 10% below its 2014 high.
The Dow Jones industrial average fell 115.44 points, or 0.64%, to 18,010.68, the S&P 500 lost 13.4 points, or 0.63%, to 2,107.39 and the Nasdaq Composite dropped 27.95 points, or 0.55%, to 5,070.03.
SECTORS & STOCKS
BSE Healthcare index plunged over 2% followed by counters like Auto, Capital Goods and Oil & gas, all dipping between 0.2-1%. BSE IT, Bankex and Realty indices are trading higher by over 0.5%.
From the pharma space, Sun Pharma has plunged over 7% after reporting weak Q4 numbers. The consolidated net profit of the company came in at Rs 888.05 crore for the fourth quarter mainly due to Ranbaxy merger impact and price erosion in some products in the US.
Net profit was adversely impacted by professional charges, harmonisation of policies of erstwhile Ranbaxy with the company, Sun Pharma said in a statement. Other notable losers are Bharti Airtel, GAIl, M&M, Tata Motors and L&T.
On the gaining side, Cipla is the top Sensex gainer, up almost 2%. The company’s EBITDA grew by 24% to Rs 508 crore in Q4 March 2015 over Q4 March 2014.
Other notable gainers are Infosys, HDFC, ITC, SBI, RIL and Coal India.
Financial shares are witnessing buying demand on hopes of a rate cut by the RBI. According to the results of a Reuters poll, the Reserve Bank of India is likely to cut its benchmark interest rate by 25 basis points to 7.25% when it meets early next week and make a similar move before December.
Reliance Industries has overtaken state-owned Oil and Natural Gas Corp (ONGC) to become the nation's most profitable company, posting a consolidated net profit of Rs 23,566 crore in the 2014-15 fiscal. RIL has gained over 1%.
With Reuters input
