Markets open lower, OMCs rally

Markets opened lower tracking weak Asian peers and investors turning to the sidelines ahead of April inflation data. The S&P CNX Nifty dipped 20 points, at 5525 and the Sensex was down 92 points, at 18, 440

The April inflation reading is expected to affect the Reserve Bank of India’s decision on rate hike. Reuters poll has predicted April Whole Sale Price Index at 8.58%. The inflation bias may remain on the upside after India’s state run gasoline companies raised prices by Rs 5 per litre soon after United Progressive alliance (UPA) and its allies won elections in three out of five states on Friday.
Analysts expect Indian markets to remain weak as Nifty has formed a bearish head on should pattern on the daily charts which indicates a major reversal in the bullish trend.
Most of the Asian markets were also trading in the red in the morning trades as sell-off in commodities weighed on resource shares.
Hong Kong's Hang Seng fell 0.4% led by losses in banking shares. Investors veered away from risky assets as the Dollar strengthened. Euro-zone debt worries also affected investor sentiment. China's Shanghai Composite index was trading flat at 2,869. The Nikkei Stock Average slipped 0.6% as rising yen weighed on exchange rate sensitive stocks. South Korea's Kospi Composite was down 0.6%, Singapore's Strait Times edged lower by 0.9% and Taiwan's weighted index was off 0.4%.
Among individual stocks, oil marketing companies were leading the gains. Bharat Petroleum and Hindustan Petroleum surged 2% each after they raised petrol prices by Rs 5 per litre. Suzlon rallied 4% after the fifth largest turbine maker reported 20% jump in fourth quarter net profit. Glenmark rallied 8% after it signed a licensing deal with Sanofi which has marketing rights in Japan, USA and Europe.

BSE Healthcare index was leading the gains, up 1.3%. Besides Glenmark Pharma, Ranbaxy advanced 2.1%, Lupin zoomed
2% and Sun Pharma was up 1.9%.

Auto shares were leading the losses, BSE auto index slipped 1.2%. Maruti Suzuki, Bajaj Auto and Cummins India all fell over 1% each.

Only four shares on the Sensex were trading in the green, BHEL advanced 0.8%, TCS was up 0.9% and Reliance Communication gained 0.4%. Top losers were Mahindra & Mahindra, down 1.8%, ICICI Bank was off 0.4% and Tata Motors
declined 1.3%.

Broader markets were flat. Market breadth was negative, 749 stocks advanced for 833 stocks which declined.