Sensex slides 652 pts, bank stocks under pressure

The benchmark indices extended losses and traded near the day`s low in the mid-morning trade. The Nifty hovered below the 17,600 level. FMCG and media stocks edged higher while bank, financial services and realty shares witnessed a bit of a selling pressure.

At 11:26 IST, the barometer index, the S&P BSE Sensex, was down 652.47 points or 1.09% to 58,993.68. The Nifty 50 index lost 201.90 points or 1.14% to 17,556.55.

In the broader market, the S&P BSE Mid-Cap index fell 1.22% while the S&P BSE Small-Cap index shed 0.83%.

The market breadth was weak. On the BSE, 1,180 shares rose and 2,155 shares fell. A total of 165 shares were unchanged.

Buzzing Index:

The Nifty Bank index fell 1.72% to 38,313.80. The index lost 3.38% in two trading sessions.

Bandhan Bank (down 2.79%), Kotak Mahindra Bank (down 2.77%), IDFC First Bank (down 2.13%), Punjab National Bank (down 2.1%), Axis Bank (down 2.02%), ICICI Bank (down 1.82%), IndusInd Bank (down 1.47%), HDFC Bank (down 1.39%), Bank of Baroda (down 1.08%) and State Bank of India (down 1.07%) tumbled.

Central Bank of India rallied 3.07%. Central Bank of India has entered into a strategic Co-Lending Partnership with Incred Financial Services Limited to offer loans to MSME Borrowers at competitive rates. The participation by both the entities in this Co-Lending arrangement will result in greater expansion of portfolio by Central Bank of India and Incred Financial Services.

Stocks in Spotlight:

Larsen & Toubro (L&T) fell 1.41%. The EPC major said that the hydrocarbon-onshore division of L&T Energy business has been awarded a large contract from Indian Oil Corporation (IOCL). As per L&T`s classification, the value of the large project is 2,500 crore to 5,000 crore.

The scope of the project involves setting up a residue hydrocracker unit (RHCU) for this P-25 project. The RHCU is licensed by Axens (France) with a capacity of 2.5 million metric tonne per annum and will upgrade the vacuum residue (VR) to high-value commercial products (mainly diesel). The contract is awarded through international competitive bidding on a lump sum turnkey (LSTK) basis.

Adani Power advanced 3.40% after the company said that it has agreed to acquire DB Power, which owns and operates a running 2x600 MW thermal power plant at Janjgir Champa District in Chhattisgarh. Adani Power said that the proposed transaction is subject to receipt of approval from the Competition Commission of India and any other approvals as may be identified following the due diligence exercise to be conducted with respect to DPPL and DB Power. The initial term of the MOU shall be till 31 October 2022, which may be extended by mutual agreement.

Ratnamani Metals & Tubes rose 0.61% after the company said that it has received new orders aggregating to Rs 1,186 crore in the first fortnight of current month. The company has bagged domestic orders aggregating to Rs 1083 crore to be executed over next 4 to 24 months.

Global Markets:

Asian stocks traded mixed on Monday as concerns over aggressive Fed hikes reemerged.

The People`s Bank of China cut its one-year benchmark lending rate by 5 basis points and its five-year rate by 15 basis points, according to an online statement. That brings the one-year loan prime rate to 3.65% and the five-year LPR to 4.3%.

US stocks fell on Friday with traders anxious about inflation and what the Federal Reserve will do to combat it.

Fed Chairman Jerome Powell is expected to speak at the central bank`s annual symposium in Jackson Hole, Wyoming this week, and shed some light on the pace of future interest rate hikes.

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