Sensex slips 185 points in early trade, Nifty holds 15,700; banks, financial stocks drag

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Benchmark equity indices opened in deep red on Thursday ahead of the weekly F&O expiry and a rally in oil prices. Weak cues from global peers also weighed on investor sentiment. The US central bank indicated it could begin raising interest rates in 2023, a year earlier than expected. Although, the Fed decided to hold interest rates near zero and said it will continue to buy $120 billion in bonds each month to fuel the economic recovery.

In opening trade, Sensex fell 185 points or 0.35% to 52,316, while the broader Nifty 50 declined 58 points or 0.37% to 15,709.

As many as 25 of 30 Sensex stocks were trading in the red. Bajaj Finance, Axis Bank, HDFC twins, Tech Mahindra slipped, down nearly 1% each, were the top Sensex laggards. On the other hand, Asian Paints, HCL Tech, NTPC, Titan and Sun Pharma were among the gainers.

Barring Nifty Realty, all sectoral indices were trading in the red. Nifty Metal lost the most as it slipped 0.81%, Nifty Bank tanked 0.71%. Whereas Nifty Pharma, Nifty FMCG, Nifty Auto indices declined anywhere between 0.15 and 0.30%. Nifty IT fell marginally by 0.03%.

In the broader markets, the S&P BSE MidCap index fell 0.6%, while the SmallCap index was flat.

Earnings today

Power Grid Corporation, Natco Pharma, Jammu & Kashmir Bank, DB Corp, Basant Agro Tech, Gyscoal Alloys, Global Vectra Helicorp, HealthCare Global Enterprises, Hindustan Media Ventures, IFB Agro Industries, Indostar Capital Finance, Khadim India, Kingfa Science, Nava Bharat Ventures, Novartis India, Power Mech Projects, Royal Orchid Hotels, Siel Financial Services, Tube Investments of India and others will announce their quarterly earnings today.

Stocks in spotlight

Wipro announced a partnership with Exaware, a leading provider of Open Network routing solutions. The partnership will jointly develop advanced engineering solutions that foster innovation in the networking industry, streamline 5G technology upgrades, and open the door to future 6G compatibility.

SBI informed that the meeting of the board of directors of the bank is scheduled on 21 June 2021, to consider and approve raising of Additional Tier 1 (AT 1) Capital by way of issuance of Basel III compliant debt instrument in USD and/or INR through a Public offer or Private placement to overseas and/or Indian investors during FY 22.

CESC said that the company’s board of directors approved a proposal for a sub-division of the existing 1 equity share of the nominal value of Rs 10 each to be sub-divided into 10 equity shares of the nominal value of Re 1 each.

Isgec Heavy Engineering has received an order for the fabrication of above-ground piping spools from Tata Projects, India for one of the projects of national importance.

Punjab & Sind Bank said that Lanco Infratech’s account with outstanding dues of Rs 215.17 crore has been declared as fraud and reported to RBI. Further, the account has been fully provided for as per existing RBI norms.

Minda Industries said that a Commercial Paper of Rs. 50 crore issued on 18 March 2021 with a maturity date of 16 June 2021 has been redeemed.

Global markets

Overseas, Asian stocks are trading mixed on Wednesday after their U.S. peers retreated from all-time highs, with investors awaiting a policy decision from the Federal Reserve.

Japan’s exports rose at the fastest pace since 1980 in May and a key gauge of capital spending grew. Ministry of Finance data on Wednesday showed exports grew 49.6% year-on-year in May, led by U.S.-bound car shipments.

U.S. stocks fell slightly on Tuesday with the S&P 500 and the Nasdaq Composite slipping from their respective records, as investors awaited the key Federal Reserve monetary policy meeting.

On the data front, the final demand index for producer prices advanced 6.6% for the 12 months ended in May, the largest increase since 12-month data were first calculated in November 2010. On a monthly basis, the producer price index for final demand rose 0.8%. Meanwhile, May’s retail sales data fell 1.3%.

The Fed’s two-day policy meeting started on Tuesday. Although the central bank is not expected to take any action, its forecasts for interest rates, inflation and the economy could move the markets. Fed Chairman Jerome Powell will speak to the press after the central bank issues its statement Wednesday.