BSE Sensex drops 42 pts to over week’s low ahead of RBI policy review meet

The BSE Sensex fell 42 points amid profit booking today.

Written by Press Trust Of India | Mumbai | Published: October 25, 2013 4:57 pm

The BSE Sensex fell 42 points amid profit booking today,posting its first weekly drop in four,as investors turned cautious ahead of the Reserve Bank of India (RBI) meeting.

The upcoming expiry of derivatives contracts and lower global cues also dampened sentiment.

Realty,capital goods,metal and auto sectors declined,while IT and teck indices moved up.

Larsen & Toubro (L&T) and ITC Ltd pulled down the Sensex even as Tata Consultancy Services (TCS) and Infosys Ltd boosted it. The big losers on the index included Hindalco Industries Ltd and Tata Steel.

The 30-share S&P BSE Sensex resumed steady at 20,725.52 and hovered between 20,622.25 and 20,782.16 before finishing at 20,683.52,a loss of 41.91 points or 0.20 per cent. The index has lost 210.37 points during the past four days and was at the lowest closing level since October 17.

“It was yet another day of lacklustre trade as traders remained cautious ahead of the Reserve Bank meet scheduled on 29 October,” said Amar Ambani,Head of Research at India Infoline. “RBI is expected to increase repo rate in the October 29 monetary policy by 25 basis points.”

The 50-share CNX Nifty on the National Stock Exchange moved down 19.45 points,or 0.32 per cent,to finish at 6,144.90. The SX40 on the MCX Stock Exchange ended at 12,309.62,down 21.7 points.

Quote: Multi Commodity Exchange of India Ltd (MCX)

Asian stock markets declined. Key indices in Taiwan,Hong Kong,China,Singapore,Japan and South Korea fell.

European markets were lower in early,with indices in France,Germany and UK down.

In the domestic market,21 Sensex shares declined,while ICICI Bank was unchanged. The lender’s standalone net profit in the July-September quarter rose 20 per cent to Rs 2,352 crore.

The major losers were Hindalco (-4.71 pc),Tata Steel (-3.09 pc),Mahindra & Mahindra Ltd (-2.48 pc),Hindustan Unilever (HUL) (-2.33 pc) and GAIL (-2.23 pc).

The gainers included TCS (2.92 pc),Wipro (2.07 pc),Sesa Sterlite (1.84 pc) and NTPC (1.36 pc).

Among the sectoral indices,S&P BSE Realty dropped 2.27 pc,followed by Capital Goods 1.61 pc,Metal 1.22 pc,Auto 1.19 pc and FMCG 0.93 pc. The S&P BSE IT index rose 1.54 pc and S&P BSE Teck added 0.98 pc.

The market breadth continued to show a negative trend after 1,420 shares ended with losses,1,022 finished with gains and 160 ruled steady.

Total turnover at the BSE fell to Rs 1,744.49 crore from Rs 2,073.26 crore yesterday.

Foreign institutional investors bought shares worth a net Rs 991.83 crore yesterday,as per provisional data from the stock exchanges.

HIGHLIGHTS

* BSE index falls 0.2 pct; NSE ends 0.32 pct lower

* FIIs extend buying streak to a 15th day

* Deutsche raises India’s BSE index target to 22,000

* Consumer goods shares: ITC,Hindustan Unilever fall

Indian shares snap 3 straight weekly gains; RBI,derivatives in focus

(Reuters) Indian shares fell on Friday,failing to extend their third weekly gains,as some blue chip shares such as Sun Pharmaceuticals Industries were hit by profit-taking after marking their highest level since November 2010 earlier in the week.

Shares gained nearly 5 percent in the last three weeks,benefiting from a return of global risk appetite as poor U.S. data has pushed back expectations of any tapering of the Federal Reserve’s monetary stimulus until 2014.

Foreign investors have continued to buy local shares,remaining net buyers for a 15th consecutive session. Provisional exchange data showed a net purchase of 9.91 billion rupees ($161.4 million) on Thursday,bringing the total to nearly 125 billion rupees during that period.

Traders expect volatility in coming days as concerns over another interest rate hike by the Indian central bank in its policy review on Oct. 29 and U.S. Federal Reserve policy meeting outcome on Oct. 30 take centre stage amid expiry of the October derivative contracts.

Although earnings of drug exporters including Lupin Ltd are expected to provide a relief.

“It is going to get volatile as expiry of derivatives contracts and RBI policy are coming at a time when we are almost virtually at lifetime highs,” said Vivek Mahajan,head of research at Aditya Birla Money.

The benchmark BSE index fell 0.2 percent,or 41.91 points,to end at 20,683.52,also marking a weekly fall of 0.95 percent,snapping a three-week winning streak.

The broader NSE index fell 0.32 percent,or 19.45 points,to end at 6,144.90,marking its fourth consecutive day of falls,also ending 0.7 percent lower for the week.

However,Deutsche Bank raised its December 2013 target for India’s benchmark BSE index to a record high at 22,000 points from 21,000,saying investor pessimism earlier this year was receding amid positive developments such as a good monsoon.

Among blue chip shares,Sun Pharmaceutical Industries Ltd fell 1.7 percent,while Tata Motors Ltd ended 0.8 percent down.

ITC Ltd shares fell 0.8 percent on concerns over the company’s volume growth,dealers said.

The company said its September-quarter net profit rose 21.7 percent to 22.31 billion rupees.

Hindustan Unilever Ltd also lost 2.6 percent a day ahead of its July-September results.

Bharti Airtel Ltd’s shares fell 1.8 percent after rival Idea Cellular Ltd on Thursday reported lower voice volumes in the July-September quarter from the previous quarter. Idea shares also ended down 3 percent.

Idea shares also ended 1.9 percent lower.

Wockhardt Ltd shares fell 1.1 percent after the company posted its smallest profit in six quarters,hurt by curbs on shipping medicines to the United States and Britain from one of its factories after their health regulators identified deficiencies at the plant.

GAIL (India) Ltd fell 2.4 percent after its July-September profit fell by 7 percent to 9.16 billion rupees.

However among stocks that gained,ICICI Bank Ltd ended 0.13 percent higher after India’s largest private-sector lender by assets,beat analyst estimates by posting quarterly profit gain of around 20.1 percent,as an appetite for cars and homes led to higher credit growth.

FACTORS TO WATCH

* Euro hits 2-year high versus dollar,German Ifo awaited

* Oil slips below $107 as supply improves

* Dollar near lows,shares cling to weekly gains

* Foreign institutional investor flows

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