Markets fall on European decline, metals biggest loser

A sideways market fell rapidly during the second half of the day as soon as European markets opened. Good news like a better than expected IIP numbers and lower food inflation barely helped the market.

The BSE Sensex fell by 249 points to close the day at 18,335.79 points while the NSE Nifty was down by 79 points to 5,486 points. All but three index stocks were in the red. Commodity stocks were the worst affected as Sterlite fell by 4.76% and Hindalco by 4.66%. ONGC was the biggest gainer with a 0.6% rise to Rs 301.95 followed by Hindustan Unilever which traded 0.5% higher at Rs 301.40. Realty firm DLF was on a positive turf with the stock climbing 0.18% to Rs 227.60.

[caption id=“attachment_8862” align=“alignleft” width=“380” caption=“These numbers do not cheer me up. Punit Paranjpe/Reuters”]  [/caption]

Markets breadth was negative with 943 advances and 1,848 declines, 133 stocks remained unchanged. Realty sector was the only sector which was positive. Metals was down by 2.99%, followed by capital goods which fell by 1.4% and banking index which came down by 1.39%.

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During the day IIP numbers were announced which showed a growth of 7.3% as compared to a market expectation of 3.6%. Food inflation declined to 7.7% from 8.53%.

Though the Asian markets closed by over 1%, it was the lower opening of the European market that spooked the market. European markets opened over 1% lower and continue to trade at an average of 1.3% lower than the previous close.

Further, new set of negative news come in after close of the Indian market. China’s central bank has increased the reserve ratio by 50 basis points. This is the 8th increase announced by the bank which will take the reserve ratio to a record of 21%.

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