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Most Asian stock markets fell and extended their losses after a survey showed that China's factory activity shrank for the first time in seven months in May, adding to concerns that a recovery in the world's second-largest economy is sputtering.
JGB prices dived as a surge in US Treasury yields added to the woes of Japan's bond market, which has suffered a steep selloff after the BOJ unleashed massive monetary stimulus last month to boost inflation.
Japan's Nikkei slumped over 5% while Hang Seng dropped over 2%. Shanghai Composite was down 0.1% while Straits Times was down 0.8%.
A rub-off effect was also seen in the Indian markets with both Sensex and the Nifty slipping between 1-2%.
Selling pressure was also visible in the mid-cap space with the BSE mid-cap index plunging 2.07% to 6,359 levels, while the small-cap index gained 1.84%, or 112 points, to 5,997 levels.
Among the key mid-cap losers, realty majors like Housing Development & Infrastructure, Unitech, Indiabulls Real Estate, D B Realty and Peninsula Land have cracked between 7-10%.
Other notable losers are Crompton Greaves, Redington India, Anant Raj, SPARC, HMT and Punj Lloyd, all slipping between 5-10%.
According to Ravi Nathani, Technical analyst, Nsetoday.com, “Stocks like Bajaj Holding is a sell with a target of 855, Tata Chemicals is a sell with a target of 300. All OMCs are sell on rise whereas support expected for HPCL is at 282, BPCL is at 370 & IOC is at 284. Cairn is a sell whereas next support is expected around 275.”
Adds AK Prabhakar, Senior Vice President (Equity Research), Anand Rathi Financial Services, “Book profit in Emami, HDIL and Patel Engineering.
