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Weakness persisted on the bourses in afternoon trade as index pivotals remained gripped in selling pressure. At 13:18 IST, the barometer index, the S&P BSE Sensex, was down 526.59 points or 1.48% at 35,146.66. The Nifty 50 index was down 161.30 points or 1.51% at 10,532.40. The market breadth, indicating the overall health of the market, was weak.

Domestic market followed weakness in other Asian shares amid rising tensions between the US and China as well as disappointing Chinese trade data for November. The exit polls on state assembly elections also made investors jittery. Investors are bracing for the state election results that will be out on Tuesday.

Among secondary barometers, the BSE Mid-Cap index was down 1.46%. The BSE Small-Cap index was down 1.52%.

The market breadth, indicating the overall health of the market, was weak. On BSE, 550 shares rose and 1,797 shares fell. A total of 119 shares were unchanged.

Kotak Mahindra Bank (down 6.11%), Reliance Industries (down 3.82%), Asian Paints (down 3.31%), Adani Ports and Special Economic Zone (down 3.14%) and Bharti Airtel (down 2.45%) edged lower from the Sensex pack.

Maruti Suzuki India (up 0.84%), NTPC (up 0.4%) and Coal India (up 0.13%) edged higher from the Sensex pack.

Indian Oil Corporation gained 2.66% to Rs 133. The company said that its board will meet on 13 December 2018 to consider and approve buyback of the fully paid-up equity shares of the company. The announcement was made on Saturday, 8 December 2018.

On the economic front, India's current account deficit (CAD) increased to US$ 19.1 billion (2.9% of GDP) in Q2 of 2018-19 increased from US$ 6.9 billion (1.1% of GDP) in Q2 of 2017-18 and US$ 15.9 billion (2.4% of GDP) in the preceding quarter. The widening of the CAD on a year-on-year (y-o-y) basis was primarily on account of a higher trade deficit at US$ 50.0 billion as compared with US$ 32.5 billion a year ago.

On the political front, market participants are awaiting poll results of five state elections due on 11 December 2018. The outcomes of the assembly elections will likely set the tone for the general elections next year. Voting in Rajasthan and Telangana took place on 7 December 2018. Assembly elections in Madhya Pradesh and Mizoram were held on 28 November 2018. The election in Chhattisgarh Assembly was held in two phases on 12 and 20 November 2018. The counting of votes in all the states will be done on 11 December 2018.

Exit polls on Friday reportedly indicated that the Bharatiya Janata Party risks losing control of Rajasthan to the Congress and faces a close fight in Madhya Pradesh and Chhattisgarh.

Overseas, Asian shares traded lower Monday following weaker-than-expected Chinese trade data released over the weekend.

China's November exports only rose 5.4% from a year earlier, Chinese customs data showed on Saturday. The customs data showed that annual growth for exports to all of China's major partners slowed significantly. Exports to the United States rose 9.8% in November from a year earlier, compared with 13.2% in October. Import growth was 3%, the slowest since October 2016. Imports of iron ore fell for a second time, reflecting waning restocking demand at steel-mills as profit margins narrow.

Meanwhile, China protested the arrest of a senior executive of Chinese electronics giant Huawei, who is suspected of trying to evade US trade curbs on Iran. US and China recently agreed to hold off on imposing further tariffs for 90 days while they attempt to resolve a range of issues from trade to technology development. The arrest could jeopardize the truce that was just agreed.

US stocks closed sharply lower on Friday as a lack of concrete progress toward reducing US-China trade tensions bolstered risk-off sentiment and overshadowed the November employment report.

Nonfarm payrolls increased by 155,000 for the month while the unemployment rate again held at 3.7%, its lowest since 1969, the Labor Department reported Friday.

Meanwhile, the University of Michigan consumer sentiment index came in at 97.5. Further, consumer credit grew at its fastest pace in 11 months in October, the Federal Reserve reported.

Oil producer club OPEC and some non-affiliated producers agreed a supply cut of 1.2 million barrels per day (bpd) from January. Despite this, the outlook for next year remains muted on the back of an economic slowdown.

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