Sensex, Nifty weak; Reliance, IT stocks fall
“A CRR cut is very unlikely, but we see a reasonable possibility for a repo rate cut,” he said.
The BSE Sensex came within 10 points of breaching the crucial 17,000 mark in early trade Monday. At 09.30 am, the Sensex traded 49 points or 0.3% lower at 17,046 while the broader Nifty index declined 13 points to 5,194.50.
The Nifty has been slowly falling to its crucial support levels. The 200 day simple moving average, considered a crucial support for markets, lies near 5,050 levels and a breach below this level will send the markets into bear territory.
"5,135-5,150 remain immediate support levels on the Nifty index though medium term pattern supports are pegged at 5,070. A failure to register a positive close by the end this week could be detrimental to the medium term setups," independent analyst Sarvendra Srivastava said.
Global cues weighed on the markets today. Asian markets traded with deep cuts. Japan's Nikkei index (-1.3%) led the losses while South Korea's Kospi index (-1.1%) was also down significantly.
Rising concerns about Europe, where bond yields in Spain and Italy - two of the bigger economies- have been rising and a slowdown in China, where the economy grew at the slowest in nearly three years, weighed on investor sentiments. On Friday, the Dow Jones index fell 1.1%.
Rate sensitive stocks like banks (0.7%) and realty (1.1%) were the top gainers ahead of Reserve Bank's annual policy tomorrow. Private lender Axis Bank (1.6%) and government owned SBI (1.4%) were the top gainers on the Nifty. DLF (0.9%), India's biggest real estate firm, was also among the top Nifty gainers.
India's biggest private firm Reliance Industries (-1.8%) was the top Nifty loser today.
IT stocks were flat to negative after a sharp selloff on Friday. Infosys (0.15%), India's second largest IT exporter, was flat. The stock had fallen 13% Friday after the company said it is likely to grow by 8-10% in 2012-13 against expectations of 12-15%.
"Markets are sensing that competitive threat from players like TCS and HCL Tech could take away some market share from Infosys. A re-rating in the stock does not look possible in the near term," Avinnash Gorakssakar, founder director of moneyinvestments.in told NDTV Profit today.
Among other frontline IT stocks, Wipro (-1.4%), TCS (-0.9%) and HCL Tech (-0.7%) traded lower.
The market breadth was positive with 57% stocks rising on the broader BSE 500 index.