Markets slide after slower IIP data

Markets ended down 0.6% after slower industrial output data in April and weak global cues.

The Nifty opened in red and remained subdued until the industrial output data for the month of April came in at 6.3%, putting pressure on stocks from capital intensive sectors.

The S&P CNX Nifty touched a low of 5,457 in the afternoon session and recovered partially to closed at 5,486, down 35 points.

The benchmark Sensex ended at 18,269, down 116 points.

The industrial out data signaled a definite slowdown in economic activity due to rising cost of credit and high inflation. Production at factories, mines and utilities grew 6.3% annually, lower than an 8.83%

reported in March last year.

Manufacturing activity which contributes 80% to the index also showed fatigue. It grew at 8.4% in April, lower than 10.4% in May.

This data was the first of a new series with a different base year of 2004-05 comprising of new components and weightage. Under the old series, annual industrial output growth in April was at 4.4%.

Analysts expect the Reserve Bank of India to slow down its rate hike activity due to cooling economic growth.

Markets will take cues from the RBI rate hike next week.

Technical analyst, Devanghsu Datta said, "Nifty would fall further only if 5450 is broken and the index would face resistance at 5525."