Markets Trade in Red, Sensex Down at 33359, Nifty at 10333

Markets Trade in Red, Sensex Down at 33359, Nifty at 10333

Sensex recovers 53 pts in opening trade on Asian cues

Crude oil prices slipped on Wednesday, but hovered near two-and-a-half year highs hit earlier this week, potentially stalling a record-setting share rally on concerns India's central bank would hold off on cutting interest rates. Meanwhile, the broad based NSE Nifty fell by 47.00 or 0.45% at 10,303.15 with 41 components posting drop.

A spurt in oil prices can trigger a fresh bout of inflation and spoil the fiscal maths of net energy importers like India.

Short-covering, along with positive Asian markets and healthy buying in pharma stocks led the key domestic equity indices to trade on a flat-to-positive note during the noon session on Wednesday.

Smallcaps such as Elecon, Astra Micro, Shriram Transport Finance, MMTC, ESL and Aban plunged over 9 per cent to cause the BSE Smallcap index to end the day at 17,497.99, down 170 points or 0.96 per cent.

A weakening rupee, which depreciated by 39 paise to 65.07 against the dollar during the day, too dampened investor sentiment.

Among specific stocks, shares of Indian Overseas Bank (IOB) slumped 1.58 per cent to Rs 24.90 after the lender reported widening of its net loss by almost 60 per cent at Rs 1,222.50 crore for second quarter ended September 30, due to higher provisioning against the bad loans. "Shares of aviation companies, Jet Airways, SpiceJet, and InterGlobe Aviation, fell 3-5 per cent on the back of surge in crude oil prices on a global scale", he added.

Foreign institutional investors bought equities worth Rs 461.47 crore yesterday, as per the provisional data.

Vinod Nair, Head of Research, Geojit Financial Services, said: "Political disturbance in Saudi is triggering high volatility in the crude prices, which is negative for India leading to depreciation in rupee".

Meanwhile, in European markets, Euro zone stocks and blue-chips gained 0.1 per cent, Reuters reported.

Sector-wise, the S&P BSE metals index declined by 228.92 points, followed by oil and gas index by 212.62 points and consumer durables index by 174.54 points.

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