Markets open weak: Sensex drops over 300 points, Nifty tests 9,400-level in early trade ahead of GDP data; Rupee up

FP Staff

Equites fell on Friday after two days of strong gains as markets awaited the release of March-quarter GDP figures later in the day, while US-China tensions further dampened sentiment.

Sensex tumbled over 300 points in early trade on Friday dragged by losses in HDFC Bank, Infosys, TCS and Reliance Industries amid weak cues from global markets.

After touching a low of 31,823.80 in opening session, the 30-share index was trading 312.34 points or 0.97 percent down at 31,888.25.

Similarly, NSE Nifty fell 95.75 points or 1.01 percent to 9,394.35.

The Gross domestic product (GDP) data is expected to show India's economy grew at its slowest pace in at least two years, as the COVID-19 pandemic hit already declining consumer demand and private investment.

Axis Bank was the top laggard in the Sensex pack, rising around 3 percent, followed by IndusInd Bank, Bajaj Finance, Tata Steel, Infosys, HDFC twins and ICICI Bank.

On the other hand, Bajaj Auto, ITC, Sun Pharma, Asian Paints and L&T were among the gainers.

In the previous session, the BSE barometer rallied 595.37 points or 1.88 percent to finish at 32,200.59, and the broader Nifty climbed 175.15 points or 1.88 percent to 9,490.10.

On a net basis, foreign portfolio investors bought equities worth Rs 2,354.14 crore in the capital market on Thursday, provisional exchange data showed.

Domestic investor sentiment turned weak ahead of gross domestic product (GDP) numbers, scheduled for release later in the day, traders said.

Experts believe that the rate of growth for the last quarter may still be in the lower single digit, while the numbers for the current quarter may reflect the actual distress in the economy.

Manish Hathiramani, Index Trader and Technical Analyst, Deen Dayal Investments, said, "The markets have opened on a subdued note this morning. We have moved in a one-way direction and some profit booking is only natural. I would be concerned with the trend reversing only if we break 9150. Until then this market can be bought into on all dips. An accumulation strategy can be adopted. The markets can retrace between 9,300-9,200. Traders can look at entering into the Nifty around these levels for a target of 9,700 and a stop of 9,150," he said.

Further, investors continue to remain cautious as COVID-19 cases as India registered biggest single-day spike of 7,466 cases.

The number of coronavirus cases in India crossed 1.65 lakh and the death toll climbed to 4,706, as per health ministry data.

Globally, the number of cases linked to the disease has crossed 58.10 lakh and the deceased tally stood around 3.60 lakh.

Meanwhile, bourses in Hong Kong, Tokyo and Seoul were trading with gains, while those in Shanghai were flat.

Stock exchanges on Wall Street ended on a negative note in overnight trade.

International oil benchmark Brent crude futures were trading 1.08 percent lower at USD 35.64 per barrel.

Rupee rises 11 paise to 75.65 against US dollar in early trade

The rupee appreciated 11 paise to 75.65 against the US dollar in opening trade on Friday as foreign fund inflows and weak American currency boosted investor confidence.

Forex traders said investors are awaiting the country's gross domestic product data for the January-March quarter, due later in the day, for further cues.

Rupee was trading in a range-bound manner as improving investor sentiment was offset by rising tensions between Washington and Beijing in the wake of the coronavirus pandemic.

The rupee opened at 75.71 at the interbank forex market and then gained further to 75.65, up 11 paise over its last close.

It had settled at 75.76 against the US dollar on Thursday.

"Markets were nervous before US President Donald Trump's announcement, later in the day, on policy moves that could spark a diplomatic conflict between Washington and Beijing," Reliance Securities said in a research note.

Moreover, over the weekend, markets will get an update on the nationwide lockdown and another extension could likely see the rupee to start on a weaker note next week, it added.

The dollar index, which gauges the greenback's strength against a basket of six currencies, fell by 0.06 percent to 98.32.

--With inputs from agencies

Also See: Markets open on positive note: Sensex jumps 300 points, Nifty above 8,900; ITC, HDFC, HUL among top gainers

Sensex rebounds 224 points from day's low, Nifty at 9,580; ONGC top gainer, jumps over 5%

Markets end strong after subdued sessions: Sensex rallies over 990 points, Nifty surges to 9,315; Axis Bank top gainer, soars over 13%

Read more on Business by Firstpost.