Market drops in early trade; breadth positive

Key benchmark indices are trading lower in early trade on selling pressure in index pivotals. At 9:25 IST, the barometer index, the S&P BSE Sensex, was down 261 points or 0.5% at 52,317.76. The Nifty 50 index was down 65.40 points or 0.42% at 15,681.05. The Nifty declined below the 15,700 level in early trade. Asian stocks are trading lower.

The S&P BSE Mid-Cap index was down 0.37%. The S&P BSE Small-Cap index was down 0.1%.

The market breadth, indicating the overall health of the market, is positive. On the BSE, 1299 shares rose and 1215 shares fell. A total of 95 shares were unchanged.

Stocks in news:

L&T rose 0.55%. The board of directors of Larsen & Toubro (L&T) has considered and approved a Scheme of Arrangement for amalgamation of L&T Hydrocarbon Engineering (LTHE), a wholly-owned subsidiary of the company) with the company. L&T and the LTHE are operating in complementary/similar lines of business that can be conveniently combined for creation of a much stronger energy portfolio.

IndusInd Bank gained 1.93%. The bank reported sharply higher profit at Rs 974.95 crore in Q1FY22 against Rs 460.64 crore in Q1FY21. Total interest jumped to Rs 9355.77 crore from Rs 8680.92 crore YoY.

InterGlobe Aviation dropped 3.51%. The company posted a consolidated loss of Rs 3,174.2 crore in Q1FY22 against loss of Rs 2,844.3 crore in Q1FY21. Revenue from operations jumped 292.2% to Rs 3,006.9 crore from Rs 766.7 crore YoY. The company`s CEO, Ronojoy Dutta said that financial results for the first quarter were severely impacted by the second wave of Covid-19.

RITES rose 0.43%. RITES has secured a road sector consultancy work order for preparation of Detailed Project Report from National Highways and Infrastructure Development Corporation (NHIDCL) with a fee income of Rs 19.10 crore.

Bajaj Healthcare jumped 5.16%. Bajaj Healthcare said that the meeting of the board of directors of the company is scheduled on 13 August 2021 to consider stock split of equity shares of the company.

K.P.R. Mill rose 1.78%. K.P.R. Mill said that the board of directors of the company at its meeting held on July 27, 2021, approved sub-division of one equity share of Rs. 5 each into five equity share of Re. 1 each.

Cyient rose 1.24%. Cyient announced that it has agreed to acquire WorkForce Delta, a leading consulting firm in mobile workforce management. The acquisition will bolster the IntelliCyient portfolio by expanding its front-end consulting capabilities for digital mobile workforce management solutions.

Global Markets:

Overseas, Asian stocks are trading lower on Wednesday, with stocks in Hong Kong struggling to recover from a two-day rout.

U.S. stocks fell for the first time in six days on Tuesday ahead of quarterly earnings reports from several megacap technology companies.

Investors are awaiting the Federal Reserve`s update on its monetary policy as the central bank`s two-day meeting began. The Federal Open Market Committee will release a statement when the meeting concludes Wednesday, followed by Chairman Jerome Powell`s news conference.

The International Monetary Fund warned Tuesday that there`s a risk inflation will prove to be more than just transitory, pushing central banks to take pre-emptive action.

Meanwhile, the International Monetary Fund (IMF), on July 27, cut India`s gross domestic product (GDP) growth forecast to 9.5% for fiscal year 2021-22, from the previous forecast of 12.5%, citing the hit on economic activity and demand due to the deadly `second wave` of the COVID-19 pandemic. For fiscal year 2022-23, however, IMF expects economic growth of 8.5%, larger than the 6.9% it had projected in April.

"Growth prospects in India have been downgraded following the severe second COVID wave during March邦ay and expected slow recovery in confidence from that setback," the multilateral institution said in its latest World Economic Outlook report.

Back home, the key benchmark indices ended lower for the second consecutive session yesterday, 27 July 2021, dragged by the weak global stocks. The barometer index, the S&P BSE Sensex, fell 273.51 points or 0.52% to 52,578.27. The Nifty 50 index lost 78 points or 0.49% to 15,746.45.

Foreign portfolio investors (FPIs) sold shares worth Rs 1,459.08 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 729.96 crore in the Indian equity market on 27 July, provisional data showed.

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