Opening Bell: Benchmark indices open lower; broader markets underperform

Oil & gas and metal stocks face a major drag.

In Tuesday’s trading session, the domestic benchmark indices cheered posting their best performance in the previous three weeks with Sensex ending 934.23 points up whereas Nifty50 closing above the 15,600 mark. In the pre-opening session on Wednesday, Nifty futures on the Singapore Exchange was seen trading 33.5 points, or 0.21%, lower at 15,589, signalling that Dalal Street was headed for a negative start.

On the global front, the major indices on Wall Street rose with an uptick seen in the shares of mega-cap and energy companies. Dow Jones Industrial Average gained 2.15% to 30,530.25 level while S&P 500 zoomed 89.95 points, or 2.45% to 3,764.79 level and the Nasdaq Composite added 2.51% at 11,069.30 level. Tokyo stocks also opened higher with the benchmark Nikkei 225 index gaining 0.67 % in the early trade, while the broader Topix index surged up 0.70%.

At the open, the Sensex was down 377.58 points or 0.72% at 52154.49, and the Nifty was down 119.80 points or 0.77% at 15519. Hindalco Industries, ONGC, Tata Steel, JSW Steel and Coal India were among the major losers on the Nifty, while gainers were Dr Reddys Laboratories, Asian Paints, HUL, Bajaj Auto and HDFC. The only Sensex gainers were Dr Reddy’s Laboratories, HUL, Asian Paints, HDFC and M&M.

At 9.30 a.m., the broader markets were seen underperforming with BSE Mid Cap and Small Cap indices losing 1.27% and 1.02%, respectively. The top three mid-cap stocks in the BSE Midcap Index comprised Rajesh Exports, Crisil and United Breweries whereas the top three small-cap stocks were Jain Irrigation Systems, Shiva Cement and Action Construction Equipments Jain Irrigation gained up to 11% at the commencement of the trading session.

The substantial up move in the shares of Jain Irrigation Systems Limited came on the back of the announcement made by the company on June 21 that its board has decided to merge its international irrigation business with Rivulis Pte Ltd., a part of Singapore's Temasek Group, to create global irrigation and climate major and considerably reduce the company's debt.

On the sectoral front, indices traded in red with the majority of the indices declining more than 1%. The BSE Oil & Gas index fell more than 2% whereas the BSE Metal Index declined beyond 3% in the first half an hour of the trading session. The top stocks dragging the index down were NALCO, Hindalco and SAIL.