Markets slip into red as bank stocks weigh

Mumbai: Equity benchmarks slipped into the negative territory on Thursday, led by banking, financial and auto stocks, as weak growth signals clouded the outlook for the ensuing results season.

After sinking 375 points during the day, the 30-share BSE Sensex ended 297.55 points, or 0.78 percent, lower at 37,880.40. Similarly, the broader NSE Nifty fell 78.75 points, or 0.70 percent, to close at 11,234.55. Investors turned risk averse amid expectations of tepid earnings by corporates, brokers said.

Kicking off the earnings season, IndusInd Bank reported a spike in bad loans, which sent its shares tumbling 6.15 percent -- the most among the Sensex constituents. According to a Motilal Oswal report, the second quarter earnings season will be tepid and uneventful. Underlying demand slowdown in the domestic economy and weak global commodities prices are expected to take a toll on earnings.

Echoing the outlook, Sunil Tirumalai, Head of Research and Strategist, Emkay Global Financial Services, expects growth trends to weaken further from Q1 levels, with the decline led by auto, telecom, power, IT services and pharma sectors.

Sectorally, BSE bankex, realty, finance, metal and auto indices fell up to 2.61 percent. Telecom, energy, teck and oil and gas indices rose up to 3.76 percent. Broader BSE midcap and smallcap indices followed the benchmarks, shedding up to 0.87 percent. Globally, investors were largely cautious ahead of the latest round of US-China trade talks.

Meanwhile, the Indian rupee appreciated marginally to 71.04 against the US dollar intra-day. Brent crude futures, the global oil benchmark, declined 0.74 percent to $57.89 per barrel.

Top gainers

Symbol LTP % change

BHARTIARTL 375.05 4.35

GRASIM 695.00 3.67

RELIANCE 1,360.15 2.67

HINDUNILVR 1,980.00 1.64

HCLTECH 1,064.00 1.23

Top Losers

Symbol LTP % change

INDUSINDBK 1,229.55 -6.04

YESBANK 40.90 -5.43

GAIL 127.30 -3.63

TATAMOTORS 116.80 -3.39

VEDL 141.00 -3.23