Mumbai: Benchmark indices extended their losing streak on Wednesday as the latest macro-economic indicators showed that a decent recovery was still some way off. The dour April industrial output and May inflation readings offset cheer from the partial rebound in the rupee.
The Sensex ended the day at 19041, down 102 points over its previous close, after touching a low of 18969. The Nifty finished at 5760, down 29 points over its close.
"There is no sign of a growth pick up," JP Morgan economist Sajid Chinoy said in an interview to CNBC-TV18 after the April Index of Industrial Production reading came in at 2.0 per cent, well below market expectations.
The Sensex ended the day at 19041, down 102 points over its previous close, after touching a low of 18969.
The number was all the more disappointing as it came on a very low base. With consumer inflation for May at 9.31 per cent, versus expectations of a sub-9 per cent reading, the market has given up hopes of the RBI cutting interest rates at its policy review meet on Monday. Already, the weakness in the rupee had lowered expectations of an interest rate cut.
Shares from the pharma, banking and oil and gas sectors found takers while those from the IT, FMCG, metal, power and auto shares were under pressure. Jindal Steel was the top gainer among frontline shares, rising over 4 per cent. It had fallen 15 per cent Tuesday after its promoter Naveen Jindal was named by the CBI in its FIR in the coal blocks allotment scam.
Other key gainers in the Nifty included IndusInd Bank and Jaiprakash Associates, up 2-3 percent. Laggards included Coal India, Tata Power and Tata Steel, which fell 2 to 3 percent.
Brokers said rupee will be the key sentiment driver in the short term. While there has been no major pull out by FIIs from Indian equities, inflows have dried down to a trickle in the last couple of weeks.
"What we have seen in the debt markets panning out since May 22 is now coming into the equity desk," Tirthankar Patnaik of Religare Capital Markets said in an interview to CNBC-TV18. He expects another 5-7 per cent slide in the rupee.