Sensex slips into red, banks lead losses

The Indian equity markets opened in the green but immediately slipped into red on subdued global cues.

Asian markets are in the red. Japan’s Nikkei is down 2.5% while Hong Kong’s Hang Seng index is down almost a percent. South Korea’s Kospi has fallen marginally while China’s Shanghai index has shed 1.5%. US stocks ended a volatile session mostly flat as Federal Reserve officials that raised questions about how quickly the central bank will end its stimulus program. The Dow Jones rose 28.64 points or 0.17%, to 16,469.99, while the S&P 500 lost 0.62 points or 0.03 percent, to 1,831.36. The Nasdaq Composite dropped 11.163 points or 0.27 percent, to 4,131.906.

While the BSE Sensex opened59.04 points down at 20792.29, and the Nifty down 21.65 points at 6189.50.

[caption id=“attachment_1260665” align=“alignleft” width=“380”]  Reuters[/caption]

All banking stocks are in the red - Yes Bank was down 1.4%, Union Bank was down 1 percent while Bank of India was down 0.7 percent.

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ONGC , Tata Motors , Infosys , Sun Pharma and Wipro are top gainers in the Sensex. Tata Power , M&M, L&T, NTPC and Bajaj Auto are major losers in the Sensex.

Even the Indian rupee opened lower by 19 paise at 62.35 per dollar against 62.16 Friday. The dollar held steady supported by an upbeat outlook on the US economy by outgoing Federal Reserve Chairman Ben Bernanke.

According to analysts, markets are expected to remain volatile this week as trading sentiment would be dictated by the first set of October-December quarter earnings from bluechips including Infosys. Industrial production numbers, due on Friday, may also have some impact on trading sentiment this week. RBI’s Q3 review of monetary policy for 2013-14 is scheduled on January28 and higher inflation and weak IIP could force the central bank to increase base rates in the meeting.

Infosys results will be anxiously awaited on Friday. Infosys has announced that it has appointed B G Srinivas and U B Pravin Rao as Presidents of the Company, reporting to S D Shibulal, CEO & MD.

The US Federal Reserve’s December meeting minutes will also be eyed as the Fed had announced its plan to reduce monthly asset purchases by $10 billion to $75 billion. Janet Yellen’s nomination as chairman of the central bank will be in focus later in the day.

For this week Nifty can show correction as technically it is looking strong on charts. In coming session if it manages to cross its resistance level of 6,270 it can test the levels of 6,380 and 6,455," said Vivek Gupta, Director Research, CapitalVia Global Research Limited.

The market ushered in the New Year on a tepid note as the BSE benchmark Sensex dropped 342.25 points last week, the worst performance for the index since the period ended November 8.