The Indian markets suffered sharp cut in last session on global concern, also there was no supporting cues from the domestic front and investors overlooked the better PMI data. As per HSBC Purchasing Managers’ Index the manufacturing sector - posted 52.0 in October, up from September's 50.4. But the October data signaled a third successive reduction of employment in the country's manufacturing sector. Today, the start is likely to be weak as the global trends continue to remain the same. The PSU oil companies are likely to rejoice with plunge in the global crude prices on signs of slowdown in Chinese manufacturing activity, also it has been reported that one of the major PSU OMC, HPCL is considering a further increase in petrol prices, which can prompt other companies too, to go for a hike. Also there will be some somberness in the commodity stocks, tailing their global peers.
Meanwhile, the government approved the Public Procurement Policy for goods produced and services rendered by Micro and Small Enterprises (MSEs) by the Central Ministries/Departments/PSUs to be notified under Section 11 of the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006. Policy is aimed at improving transparency and providing the MSMEs an access to many high value contracts, in sectors such as Defence.
Result session is going in full swing and there will be lots of important result announcements to keep the market buzzing. Allahabad Bank, Andhra Bank, Hindustan Motors, Trent and Tube Investments will be among the many to announce their numbers today
The US markets slumped on Tuesday on European concern that Greece will hold a vote on an unpopular European plan to rescue the nation’s economy, whether to accept the terms of the eurozone bailout or not. The Asian markets too have made a weak start and all the major indices are trading with considerable losses, some are even down by over two percent on slowing global economic growth and on concern of hurdle to Europe’s rescue plan.
Back home, Indian stock markets on Tuesday concluded second straight session on a disappointing note as the benchmark equity indices extended their southbound journey on the back of daunting global developments as well as unsupportive domestic economic reports. Hefty position squaring from the rate sensitive Automobile, Banking and Realty counters dragged the frontline gauges by over a percentage points. Marketmen lacked enthusiasm as little clarity emerged over how the Euro-zone sovereign debt trouble will be tackled. Sentiments globally got butchered after the Greek Prime Minister George Papandreou’s call for a confidence vote and a referendum on last week’s deal, injected a lot of uncertainty in the minds of investors. Investors’ took to risk aversion post the Greek PM’s statement and trimmed hefty positions from risky asset classes like equities. On the domestic front, automobile companies announced monthly sales numbers and market leader Maruti Suzuki’s dispiriting sales numbers triggered selloff in the auto stocks. Also the shares of airline companies like Kingfisher and Jet Airways bore the brunt of selling pressure after government owned oil marketing companies hiked the price of aviation turbine fuel by 3.8%. Meanwhile government released India’s September Core industries’ growth reading which showed that sharp decline in key sectors of coal, natural gas and fertilizer pulled down the index of eight core industries on the back of rising input costs and high interest rates. In the meantime investors overlooked India’s PMI reading which showed that manufacturing sector in October recovered for the first time in last six months on the back of improved conditions in the sector, which reflected rise in domestic orders for new business. Earlier on Dalal Street, the benchmark got off to a dismal opening, following the weak Asian markets but showed signs of recovery and hit intraday highs in early hours of trade. Despite coming closer to the neutral line the frontline indices failed to capitalize on the early momentum and soon drifted into a southbound journey. The indices slowly but steadily kept losing steam and hit the lowest point in the session in dying hours of trade post which some short covering ensured that the bourses snap the session off the day’s low. Moreover, the broader markets too finished on a pessimistic note with cuts of over half a percent but managed to outclass their larger peers. On the BSE sectoral space, the Automobile counter settled as the top laggard in the space after suffering nasty lacerations of around two percent after auto companies failed to show impressive growth in the festive season. The rate sensitive realty and bankex indices too went home with large cuts of over one and half a percent. Finally, the BSE Sensex shaved off 224.18 points or 1.27% to settle at 17,480.83, while the S&P CNX Nifty plunged by 68.65 points or 1.29% to close at 5,257.95.
Tuesday was another down day for the US markets, not only US the whole global markets turned red after Greece's prime minister said he would call a national vote on an unpopular European plan to rescue nation’s economy, the first referendum to be held in Greece since 1974. However, there was concern that Greek lawmakers dissented from the plan and the government would not last until a confidence vote on Friday. Apart from this, an economic report from domestic front too disappointed the marketmen, an industry report showed the pace of growth in the US manufacturing sector unexpectedly slowed in October. The Dow Jones industrial average fell 297.05 points, or 2.48 percent, to close at 11,657.96. The Standard and Poor’s 500 lost 35.02 points, or 2.79 percent, to 1,218.28, while the Nasdaq composite dropped 77.45 points, or 2.89 percent, to 2,606.96.
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