Sensex feels RIL tremors, slides 120 pts

Mumbai: A steep fall in Reliance Industries on Wednesday shaved 120 points off BSE benchmark Sensex, pushing it below the psychological 18,000 level for the first time in the last five days.

Notwithstanding, positive Asian trends and European sentiments, the 30-share index of the Bombay Stock Exchange closed lower by 120.24 points, or 0.67 points, at 17,957.37 points. The country’s markets were the only losers among the major bourses in the Asian region.

The National Stock Exchange’s 50-share Nifty index lost 0.67% to finish at 5,394.35 points. Mukesh Ambani-led RIL, which reported its best ever 32.3% jump in quarterly profit, plunged over 3% to settle at Rs 1,020.95. RIL, which carries the maximum weight in the Sensex, was the biggest loser among the 30 index stocks. Analysts attributed the fall in RIL to concerns that the gas production in the KG-D6 fields is unlikely to rise for the next 6-12 months as it need to study the reservoir for its sustainability.

“We think the next two quarters are unlikely to yield any earnings surprises as KG-D6 production remains constant and refining and petchem margins remain stable,” Elara Securities analyst Alok Deshpande said in a note.

“We believe that there will be some earnings cuts as the Street adjusts its estimates for delayed KG-D6 production ramp-up and slightly subdued GRMs. Factoring in delay in KG-D6 ramp-up and slower-than-expected refining demand pick-up, we have reduced our estimates,” he added. Engineering major L&T declined for the second successive day after it posted a 58% decline in its June quarter profit. L&T declined 2.06% to settle at Rs 1,824.80.

HUL sank for another day ending 3% lower after it posted a fall of 1.8% in June quarter profit. Realty giant DLF lost 2.36%, erasing its Tuesday’s gains.

Most of the shares, which had gained on Tuesday after the RBI announced moderate rate hike, lost the ground on Wednesday.

ICICI Bank lost 1.63%, Hero Honda 0.59% and Maruti by 0.45%.