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Weak trade continued over the Dalal Street in late morning session, with both Sensex and Nifty trading in red terrain, despite positive cues from other Asian markets. Domestic sentiments were negative, amid reports that with inflation showing no signs of abatement, the Reserve Bank is likely to increase the benchmark lending rate in quick succession in its forthcoming monetary policy review, a hint for which has already been given by Governor Shaktikanta Das.

Traders failed to get any sense of relief, even after Prime Minister Narendra Modi shared details of various initiatives of his government, and asserted that it has made a series of efforts to boost pro-people governance which helps the poor, youth, farmers, women and the marginalised.

On the global front, Asian markets were trading mostly in green, even after China's service sector logged another marked contraction in May due to measures taken to contain the recent uptick in COVID-19 cases. The survey results from S&P Global showed that the Caixin services Purchasing Managers' Index rose to 41.4 in May from a 26-month low of 36.2 in April. But a score below 50.0 indicates contraction in the sector.

The BSE Sensex is currently trading at 55529.75, down by 239.48 points or 0.43% after trading in a range of 55295.74 and 55767.14. There were 7 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.88%, while Small cap index was down by 0.93%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.24%, Energy up by 0.12%, Metal up by 0.06% and Power up by 0.01%, while IT down by 1.47%, Consumer Durables down by 1.24%, Consumer discretionary down by 1.20%, TECK down by 1.15% and Realty down by 1.12% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 0.74%, Tata Steel up by 0.73%, HDFC up by 0.35%, ITC up by 0.31% and Kotak Mahindra Bank up by 0.26%. On the flip side, Bajaj Finserv down by 2.89%, Tech Mahindra down by 2.84%, HCL Tech. down by 1.71%, Wipro down by 1.64% and Asian Paints down by 1.48% were the top losers.

Meanwhile, the government has decided not to impose countervailing duty on certain aluminium products being imported from Malaysia, as the finance ministry has not accepted the recommendations of the directorate general of trade remedies (DGTR).

The commerce ministry's investigation arm DGTR had conducted a probe into alleged exports subsidisation by Malaysia on 'aluminium primary foundry alloy ingot in different forms' following a complaint by the domestic industry and on January 31, 2022 recommended imposition of the duty. The central government, after considering the final findings of the designated authority (DGTR), has decided not to accept the recommendations.

In an application to the directorate, domestic firms had alleged that subsidised imports from Malaysia are causing material injury to them and had requested the imposition of countervailing duties on the imports. While the DGTR recommends the duty, the finance ministry takes the final call on the imposition. Countervailing duty is a country-specific duty imposed to safeguard the domestic industry against unfair trade subsidies provided by local governments of exporting nations.

The CNX Nifty is currently trading at 16528.30, down by 56.00 points or 0.34% after trading in a range of 16444.55 and 16579.20. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were ONGC up by 2.21%, JSW Steel up by 1.82%, Bajaj Auto up by 1.64%, Cipla up by 1.37% and HDFC Life Insurance up by 1.28%. On the flip side, Bajaj Finserv down by 2.81%, Shree Cement down by 2.46%, Tech Mahindra down by 2.41%, BPCL down by 2.39% and Grasim Industries down by 1.73% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 229.85 points or 1.09% to 21,311.98, Nikkei 225 surged 197.61 points or 0.71% to 27,959.18, Taiwan Weighted strengthened 61.01 points or 0.37% to 16,613.58, Shanghai Composite gained 33.47 points or 1.05% to 3,228.93and KOSPI rose 11.66 points or 0.44% to 2,670.65. On the flip side, Straits Times trembled 4.45 points or 0.14% to 3,227.52 and Jakarta Composite lost 118.14 points or 1.64% to 7,064.82.

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