As anticipated, the key Indian stock indices declined in early morning trade, extending this week's drop. The growing worries over the state of the domestic economy and renewed fears over the deteriorating external backdrop are seemed to be triggering the sell-off in the market. Further, the steep fall in the rupee this week has played a key role in dampening the sentiment for equity markets. Concerns mount over the country's widening twin deficits amid slowing GDP growth. FII inflows have tapered-off ever since the Finance Minister proposed the new GAAR rules in the Union Budget. The controversy surrounding Vodafone tax case and the recent TRAI recommendations for 2G auctions have also stoked worries about adverse regulatory action hitting domestic economic activity.
Meanwhile, the midcap and the small-cap counters are trading negative by over half a percentage point each. On the sectoral front, except for Healthcare and FMCG indices, all the other indices are trading in red. Bank, Capital Goods and Realty indices are leading the list of losers with losses of over one and a half percentage points each. Further, market breadth seems to be in favor of the bears as only one stock is seen advancing for every three declines.
(Pic. Source- bseindia.com)
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