Steep losses in Tata Motors, Bharti Airtel and ICICI Bank today dragged BSE benchmark Sensex to three-week low of 19,781.19 and Nifty to below 6,000 as tepid earnings and RBI’s draft guidelines on bank provisioning requirements hit the sentiment.
The Sensex fell by 113.79 points, or 0.57 per cent, to 19,781.19. The gauge commenced the day higher on investors covering their pending positions but frittered away gains on heavy selling after noon. The index had lost 110 points in the previous session.
Similarly, the broad-based National Stock Exchange index Nifty lost 35.85 points, or 0.59 per cent, to end at 5,998.90, dipping below 6,000.
“Markets ended down on the last day of the week on weak global cues and uninspiring results. Bharti and BHEL reported numbers which were below expectations. Also, banking stocks fell,” said Dipen Shah, Head PCG Research, Kotak Securities.
Tata Motors was the biggest loser in Sensex as it lost 4.36 per cent. Bharti Airtel lost 2.62 per cent and Bhel over 1 per cent. While Bharti posted 72 per cent decline in net profit at Rs 284 crore for December quarter, BHEL profits declined by 17.5 per cent to Rs 1,182 crore.
ICICI Bank, HDFC Bank and SBI lost between 1-2 per cent after RBI yesterday issued revised draft policy norms for restructured loans.
According to RBI draft norms, banks would need to step up provisioning on restructured loans to 5 per cent by FY’15 on the existing stock of restructured loans.
“Many government banks to be more impacted,” said Rajeev Varma, Research Analyst, DSP Merrill Lynch India, in a report.