Benchmark come off the day's low; European shares trade flat
The domestic equity benchmark came off the day's low in afternoon trade. The Nifty traded above the 23,850 mark. The market witnessed across the board selling, with auto, IT & consumer durables leading the losses.
At 12:30 IST, the barometer index, the S&P BSE Sensex was down 498.47points or 0.65% to 76,445.81. The Nifty 50 index lost 183.25 points or 0.76% to 23,872.55.
In the broader market, the BSE 150 MidCap Index fell 0.77% and the BSE 250 SmallCap Index shed 0.55%.
The market breadth was weak. On the BSE, 1,622 shares rose and 2,572 shares fell. A total of 224 shares were unchanged.
Gainers & Losers:
Coal India (up 3.66%), NTPC (up 1.87%), Adani Ports (up 1.47%), Power Grid Corp (up 1.27%) and Adani Enterprises (up 1%) were the top gainers.
Eicher Motors (down 4.99%), Bajaj Auto (down 2.96%), Mahindra & Mahindra (down 2.54%), Asian Paints (down 2.22%) and Wipro (down 2.13%) were the top losers.
Stocks in Spotlight:
Nephrocare Health Services was down 0.06%. Nephroplus Health Services Kazakhstan LLP, the company's step-down subsidiary, has entered into a sale & purchase agreement with Aizhan Slambekovna Zhambulova for acquisition of 100% stake in Dialysis Center Almaty LLP for Rs 11.63 crore. Dialysis Center Almaty is engaged in the business of providing dialysis services through its dialysis centres in Kazakhstan.
EMS jumped 5.20%. The company received the lowest bidder (L-1) status from the Directorate of Local Bodies, Government of Rajasthan, for a sewerage project. The estimated order value is approximately Rs 218.65 crore.
BEML added 2.47%. The company has secured an additional order worth Rs 180.60 crore from Integral Coach Factory for manufacturing & supply of Vande Bharat (Sleeper) trainsets.
Global Markets:
European equities were flat while their Asian peers traded sharply lower on Wednesday as a relentless global bond market rout continued to drain liquidity and undermine stock valuations.
Renewed US-Iran hostilities pushed crude oil prices higher and heightened concerns over inflation and sustainability of global growth rates.
Wall Street extended its decline on Tuesday, with the Dow Jones Industrial Average falling 418.97 points, or 0.79%, to 52,766.93. The S&P 500 declined 54.67 points, or 0.71%, to 7,631.47, while the Nasdaq Composite dropped 271.11 points, or 1.03%, to 26,099.77.
The selloff followed a sharp rise in oil prices after renewed military action between the US and Iran raised concerns over supply disruptions through the Strait of Hormuz. Brent crude rose to around $95 a barrel on Wednesday, its highest level in five weeks, after gaining for a second consecutive session.
Higher energy prices have intensified inflation concerns and contributed to a global bond selloff. The US 10-year Treasury yield climbed to around 4.80%, while Japan's 10-year government bond yield approached 3%, adding to pressure on equity valuations.
Markets are also reassessing the Federal Reserve's interest-rate outlook. The probability of a 25-basis-point rate hike at the Fed's 16 September meeting has risen to about 67%, compared with 39.6% a week earlier, following hawkish comments from Fed officials.
US economic data released overnight presented a mixed picture. The ISM Manufacturing PMI eased to 54.6 in August from 55.6 in July, indicating that manufacturing activity continued to expand, but at a slower pace. The New Orders Index declined to 53.7 from 56.7, while the Employment Index fell to 51.2 from 52.8. The Prices Index remained elevated at 71.1, pointing to continued input-cost pressures.
The US labour market remained relatively resilient, with JOLTS job openings rising by 89,000 to 7.271 million in July. However, hiring fell by 278,000 to 5.054 million, while the hires rate declined to 3.2%, suggesting some moderation in labour-market momentum despite continued demand for workers.
US construction spending also weakened, falling 0.5% in July to a seasonally adjusted annual rate of $2.158 trillion. The decline added to signs of softer activity in parts of the US economy.
Investors will now track upcoming US labour-market data, including the nonfarm payrolls report due Friday, for further clues on the Federal Reserve's policy path. The combination of elevated oil prices, persistent price pressures and signs of softer economic activity is likely to keep markets volatile.
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