Markets end lower on selling, global cues

Markets ended in the red today, on cues from global peers and selling pressure in IT stocks.

The Sensex after touching a low of 16,561, managed to recover some lost ground and itouch a high of 16,760.

The index finally ended near that level at 16,713 - down 108 points. Nifty ended down 23 points at 5,017.

Weak jobs data from the US on Friday and FII selling of over 9,000 crore in August dampened sentiments. Services sector growth has slipped to a two-year low of 53.8 in August from 58.2 in July, according to the HSBC Markit Business Activity Index due to slowing global economy and monetary tightening in India, which also weighed on the investors' mind.

Asian markets ended in the red; Nikkei dropped 1.8% to 8,784. Seoul Composite tanked 4.3% to 1,785. Taiwan, Straits and Chinese markets declined around 2% each.

Markets in Europe slipped in line with their Asian counterparts. CAC and DAX were down over 3% each in trades. Markets in Europe will look towards the Central Bank's monthly policy meeting on interest rates on Thursday.

Today's fall has come after the 6% rally last week.

Most of the sectoral indices were in the red, with IT and oil & gas stocks leading the decline. IT shares were the worst hit after Goldman Sachs cut target price on some of the stocks. BSE IT index slipped 1.5% to 4,4,924.

Patni Computers was the biggest loser among IT stocks and dipped 4.2% to Rs 276. Wipro, HCL Technologies and Infosys declined 2-3% each.

"As far as I can see, there

is no positive factor specific to the IT sector that can enable the sector to move up in a falling market.

"If the market weakens the sector will in all likelihood weaken with it. But the sector can outperform other sectors if the market itself shows some strength or at least remains steady. To some degree it is a defensive sector," said Hormuz Maloo, Technical Analyst, Geojit BNP Paribas Securities.

Among the other losers, RIL and ONGC dragged the OIl & gas index down 1.7% to 8,382. Reliance dropped 2% and ONGC shed 2.6%. Among other stocks, HDFC and NTPC declined 1.6% each.

ONGC's follow-on share sale, valued at around Rs 11,500 crore ($2.5 billion) and delayed by more than six months, is likely to be launched on September 20 and will close on September 23.

BSE auto index managed to recover from its intra day low and was up 1.3% at 8,682. Hero Motocorp, Bajaj Auto advanced on a healthy sales growth for the months of August. Hero Motocorp surged 5% to 2,174.

Bajaj Auto gained 2.7%. maruti Suzuki and Mahindra & Mahindra were up 0.4% each. Jaiprakash Associates and Jindal Steel also moved into the green with 2-4% gains.

Debutant Brooks Laboratories has logged smart gains at the opening bell. The stock opened at a premium of 10% at Rs 110, and soon soared to a high of Rs 131 on the BSE. However, it soon slipped below the issue price and ended at a discount at Rs 60.

Over 30 million shares changed hands at the counter today.

The BSE market breadth was positive with 1,481 stokcs on the advancing side and 1,329 on the declining side.

Around 2,920 stocks were traded on the BSE today.