Indian shares are seen opening little changed on Tuesday, tracking weak Asian cues as doubts grow about whether European leaders will make any progress at a summit later this week.
German Chancellor Angela Merkel once again dismissed "euro bonds, euro bills and European deposit insurance with joint liability and much more" as "economically wrong and counterproductive," leaving investors worried that the debt crisis is worsening.
Spain's banking sector also came under further pressure on Monday night after ratings agency Moody's cut its credit ratings on 28 Spanish banks. Asian markets are trading broadly lower, while the euro is holding steady near a two-week low against the dollar.
Closer home, UPA's presidential nominee Pranab Mukherjee is set to resign as finance minister today, raising questions about who will take over the finance ministry. Those in the race of the hot-seat include home minister P. Chidambaram, technocrat C. Rangarajan, former commerce and industry minister Kamal Nath, rural development minister Jairam Ramesh and Plan panel deputy chairman Montek Singh Ahluwalia.
Indian shares fell modestly on Monday, erasing early gains as the Reserve Bank of India's measures to prop up capital inflows failed to meet heightened expectations. The benchmark BSE Sensex rose about 160 points early in the session before reversing direction and ending down about 90 points or half a percent at 16,882, while the broader Nifty index fell by 31 points or 0.61 percent to 5,114.
In corporate news, C&C Constructions announced that it has received Rs 151 crore order from Ircon International for construction of a bridge in Rajasthan.
Bhushan Power & Steel along with Titanic Steel Industries and Olympian Finvest has revised its open offer to shareholders to 79.3 lakh from 52 lakh shares of Orissa Sponge Iron & Steel.
The Gujarat High Court has rejected Essar Oil plea for relief in repayment of over Rs 8000 crore due as sales tax deferment liability and directed the state to expedite the recovery, including interest and penalty.
U.S. stocks declined sharply overnight, with lingering concerns about the ongoing European debt crisis weighing on the markets. News reports of continued differences among EU leaders over growth and fiscal discipline, a move by Fitch ratings to downgrade Cyprus' sovereign credit grade to junk status and the resignation of Greece's new finance minister because of ill health added to concerns about weaker growth in the U.S., Europe and China, overshadowing positive U.S. new-home-sales data . The Dow ended down 1.1 percent, the tech-heavy Nasdaq tumbled 2 percent and the S&P 500 slid 1.6 percent.
European stocks also ended notably lower and the euro slid against the dollar after Spain formally asked for a bailout to shore up its ailing banking sector. Major European averages such as France's CAC 40 and the German DAX fell over 2 percent each, while the U.K.'s FTSE 100 lost 1.1 percent.
by RTT Staff Writer
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