Market may extend last two days of losses on weak global cues

The key benchmark indices may extend last two days of losses on weak Asian stocks and close to 2% losses on Wall Street on Tuesday. Cement stocks will be in action as companies unveil August 2009 dispatchment figures. While, auto stocks may extend gains after posting strong sales figures in August 2009.

A tepid debut of state-run power firm NHPC pulled the market lower on Tuesday 1 September 2009 in what was a choppy trading session. Weak European stocks and lower US index dampened investor sentiment. The BSE 30-share Sensex fell 115.45 points or 0.74% to 15,551.19 on Tuesday. The BSE Sensex has lost 371.15 points or 2.33% in last two days after gaining for seven straight days. The BSE Sensex had jumped 1112.70 points or 7.51% in seven trading sessions to settle at 15,922.34 on Friday, 28 August 2009 from 14,809.64 on 19 August 2009.

Shares of state-run hydropower generator NHPC settled at Rs 36.70, a premium of 1.94% on the BSE compared with the IPO price of Rs 36 per share.

As per the provisional figures on NSE, foreign funds sold shares worth Rs 635.94 crore and domestic funds bought shares worth Rs 366.89 crore on Tuesday.

India's exports fell an annual 28.4% in July 2009 over July 2008 and imports fell 37.1%, data released by the government during on Tuesday, 1 September 2009, showed.

A latest survey showed India's manufacturing activity expanded at its slowest pace in five months in August 2009. The HSBC Markit Purchasing Managers' Index (PMI), based on a survey of 500 companies, fell to a five-month low of 53.2 in August 2009 from a revised reading of 55.4 in July 2009. The new orders index fell to 56.2 in August 2009, also its lowest in four months, from 60 in July 2009.

The PMI has been above 50, which separates expansion from contraction, for five months. Before that, it shrank for the five months through March 2009, hitting a trough of 44.4 in December 2008.

India's gross domestic production (GDP) grew 6.1% in Q1 June 2009 compared with the year-earlier, figures released by the Central Statistical Organisation announced on Monday, 31 August 2009, showed. The segment grouping financing, insurance, real estate and business services led growth in GDP, gaining 8.1% on year. The category including trade, hotels, transport and communication was also up 8.1%.

The GDP growth was lower than 7.8% achieved in Q1 June 2008 but it accelerated from the 5.8% expansion in Q4 March 2009.

Asian shares pulled back on Wednesday after a sell-off on Wall Street prompted a round of profit-taking. The key benchmark indices in Hong Kong, Japan, South Korea, Singapore fell by between 0.39% to 2.63%. But, China's Shanghai Composite rose 1.45% and Taiwan's Taiwan Weighted gained 0.3%.

The US markets started the month of September with a sharp selloff on Tuesday, 1 September 2009 on the back of worries about more bank failures and the fact that the market may have gotten ahead of the recovery. The Dow slipped 185.68 points, or 2%, to 9,310.60. The S&P 500 fell 22.58 points, or 2.2%, to 998.04, while the Nasdaq Composite Index fell 40.17 points, or 2%, to 1,968.89.

Investors seemed to shrug off some encouraging report on the manufacturing front. The ISM manufacturing index rose to 52.9 in August from 48.9 in July. This was better than the 50.5 that was expected, it was also first time the reading topped 50 since January 2008. Reading above 50 indicates expansion in manufacturing.

Pending-home sales jumped 3.2% in July to their highest level since June 2007. It was the sixth straight increase and better than the 2% rise economists had expected. But construction spending slipped 0.2% in July against a 0.1% uptick in June.