BSE Sensex falls 144 pts for second session on inflation worries

Apr 15 2014, 17:21 IST
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The NSE index fell 0.64 per cent, its biggest single day percentage fall since March 3. Reuters The NSE index fell 0.64 per cent, its biggest single day percentage fall since March 3. Reuters
SummaryBSE Sensex shuttled between a high of 22,737.31 points and 22,416.24 points during the day.

Going ahead, IT stocks could remain in focus as TCS (on Wednesday) and other frontline IT stocks are scheduled to announce their numbers.

Also read: Rahul Gandhi assets powered by property

Indian shares end lower for second straight day

HIGHLIGHTS

* BSE index closes down 0.64 percent, NSE index ends 0.64 percent lower

* NSE index marks biggest fall since March 3

* Interest sensitive stocks fall on inflation

(Reuters) - India's broader NSE index fell for a second consecutive session on Tuesday, marking its biggest fall since March 3, as interest-rate sensitive shares such as Housing Development Finance Corp fell after wholesale inflation accelerated more than expected.

The wholesale price index (WPI) in March rose a much faster-than-expected 5.70 percent from a year earlier, marking a three-month high and coming well above the 5.30 percent increase forecast by economists.

Concerns that a rally that sent indexes to record highs last week may have been overdone also weighed, especially as Asian shares were hit by data showing China's money supply growing at the weakest pace in more than a decade.

Foreign institutional investors, who have pumped in $4.8 billion so far in 2014, became net sellers worth 3.63 billion rupees ($60.3 million) on Friday for the first time since March 10. Markets were closed on Monday for a holiday.

"With the Nifty seeing a one-sided rally for the last several weeks, investors may continue to book partial profits too. In the coming sessions, fourth quarter results, election outcome and global cues will have a major impact on the market trend," said by Rakesh Goyal, Senior Vice President, Bonanza Portfolio Ltd.

"However, despite selling pressure, Nifty is seen holding above the 6700 level well, which shows optimism in the near term. The index can be seen trading in a compact range of 6650-6820 for the last few trading sessions," he added.

The benchmark BSE index closed 0.64 percent lower at 22,484.93, while the broader NSE index also ended down 0.64 percent at 6,733.10.

Interest rate-sensitive shares such as those of banks and real estate companies fell after the surprisingly strong wholesale price inflation.

These sectors had surged on anticipation the Reserve Bank of India would hold off on further interest rate hikes after tightening monetary policy by 75 basis points since September.

Housing Development Finance Corp. fell 3.39 percent, while DLF Ltd lost 5.8 percent and Unitech closed 2.1 percent lower.

Among banks, State Bank of

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