US-Sino trade war sends Bulls cowering in India

In its longest losing streak in over eight years, the stock market dropped for the ninth straight session on Monday following sell-off in the last hour of trading on concerns over the US and China trade talks.

BSE Sensex dropped 372 points, or 0.99%, to 37090.82 points, while NSE Nifty 50 ended 130.70 points, or 1.16% lower at 11148.20 points. Sensex touched an intra-day low of 36999.84, while the figure was 11125.60 for Nifty.

The rupee fell by 61 paise to 70.52 against the US dollar, its lowest level in two months in the midst of US-China trade concern and rising crude oil prices.

According to Deepak Jasani, head of retail research, HDFC Securities, emerging-market currencies have suffered from the trade headlines. "The Chinese yuan reached a four-month low and the trade-sensitive South Korean won fell more than 1%. Dow futures were down 301 points early Monday morning, while S&P 500 and Nasdaq futures were down more than 1%."

For the last few sessions, foreign investors have been offloading shares in the domestic market, which is impacting investor sentiments.

Of the 30-stock Sensex, 23 ended in the red. Similarly, 40 of the Nifty 50 shares fell.

Among the Sensex stocks, major losers were Sun Pharmaceutical, YES Bank, Tata Steel, IndusInd Bank, Tata Motors and L&T, losing between 2.81% and 9.39%. Whereas, HDFC, Hindustan Unilever, Infosys, Bajaj Finance, Coal India, Bajaj Auto and HeroMoto Corp, gained between 0.03% and 1.06%.

Of the 11-sectoral indices on Nifty, ten ended in red, led by Nifty PSU Bank (-5%), Nifty Pharma (-4.37%) and Nifty Media (-3.78%).

BSE MidCap and BSE SmallCap underperformed benchmark Sensex. S&P BSE MidCap lost 1.84% and BSE SmallCap lost 2.15%.

Global equities on Monday also fell after trade negotiations between the US and China could not achieve a favourable conclusion as neither side showed any willingness to budge, raising fears of a fresh round of tit-for-tat tariffs.

Sameet Chavan, chief analyst, technical and derivatives, Angel Broking, said, "We kick-started this correction last Monday with a decent gap down opening, and today too the proceedings for the week began on a weak note. Global uncertainty continues and somehow looking at the smart recovery in US markets on Friday, some hopes were built for a relief move. But things escalated over the weekend, and hence the start was once again disappointing for traders across the globe. Today, the index consolidated for the major part, but once again last hour sell-off axed down all hopes as there was complete panic seen across the board. Eventually, yet another session ended deeply in red with a cut of over a percent."

Jasani said the Nifty ended in the red on Monday for the ninth consecutive session for the first time in more than eight years.

"The weakness came on the back of negative global markets as investors are concerned about global economic growth after trade negotiations between the US and China failed to avoid raising tariffs on $200 billion of Chinese imports into the US with effect from May 10. Nifty ended 130.7 points lower at 11148.2, a more than two-month closing low," he said.