The bulls on Dalal Street kept their cool amid a global rout that shaved 2 per cent off Asian shares, due to escalating trade war worries after US warned China of another round of tariffs — this time worth $200 billion.
The NSE Nifty index on the NSE closed just one point up at 10,948.30. The 30-share BSE Sensex, which was up over 100 points in the afternoon trade, closed 26.31 points, or 0.07 per cent, up at 36,265.93. Weak opening in European markets further forced the index to pared most of its days gains.
Overall market breadth remained in favour of the bears in the domestic market.
Jayant Manglik, President, Religare Broking said. "The escalating trade tensions between the US and China dampened the sentiments and capped the market upside."
As many as 30 stocks in the Nifty index closed in the red with UPL, Coal India, Hindalco, Vedanta and Tata Motors slipping between 2.50 per cent and 5.50 per cent.
On the other hand, IT major Tata Consultancy Services rallied more than 5 per cent post better-than-expected results for June quarter. Bharti Infratel, Bajaj Auto, HUL and RIL gained up to 3 per cent.
Sectorwise, the BSE Metal index (down 3 per cent) took a heavy beating on trade war woes. It was followed by auto, telecom, consumer durables and capital goods that slipped up to 1 per cent.
On the other hand, the BSE IT sector gained more than 2 per cent on hopes of better outlook.
The rupee is expected to be around 68-72 against the dollar in the next 2-4 months, and the depreciation bias in the domestic currency is likely continue, says a UBS report.
Vinod Nair, Head of Research, Geojit Financial Services said, “Improving outlook on IT index helped the market to keep its positive momentum while escalation in trade tensions between US and China capped the upside. Expectations of better Q1 result and decline in oil price will support market to prolong the current stability. Progressing monsoon and higher MSP gives leeway for consumption oriented sector to come to the limelight."
Dow Futures were trading over 220 points down at the time of closing of Indian equity markets. Chinas Shanghai Composite index dipped 1.82 per cent, while Hong Kongs Hang Seng lost 1.31 per cent. Further, Japanese shares ended lower to snap a three-day winning streak as fears about the global economic outlook due to the escalating trade war weighed on shippers and machinery makers. Nikkei 225 closed 1.21 per cent down at 21,932.21.
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