BSE Sensex falls for second day as profit-taking mars markets, ICICI Bank shares drop

Written by Reuters | Mumbai | Updated: Dec 5 2013, 02:57am hrs
The benchmark Sensex buckled under selling pressure in the second half of trade today and fell over 146 points as rising crude oil prices renewed fears of inflation, amid investors adopting a cautious stance ahead of state election results.

After losing 43.09 points yesterday, trading in Sensex began on a quiet note as barometer remained in a tight range.

However, the markets started showing cracks around 1400 hours.

Hurt by losses in ITC, ICICI Bank, HDFC and Tata Motors, the Sensex lost 146.21 points, or 0.70 per cent, to end the session at 20,708.71. 19 constituents of 30-share Sensex fell.

Brokers said domestic stocks fell after a US crude oil benchmark rose to over an five-week high after reports said there was a drop 12.4 million barrels in inventories. WTI crude was trading at USD 97.3 level when Indian market closed.

Profit-booking ahead of state polls results and speculation that US may taper its bond buying programme sooner-than-expected also hit market sentiment, they added.

On similar lines, the 50-share National Stock Exchange index Nifty declined by 40.90 points, or 0.66 per cent, to 6,160.95 led by stocks of realty, auto and banking shares.

Also, SX40 index, the flagship index of MCX-SX, closed down 64.87 points, or 0.52 per cent, at 12,307.07.

Sectorally, the BSE Realty sector index suffered the most by losing 2.67 per cent, followed by FMCG index (1.36 per cent), Auto index (1.05 per cent) and Capital Goods index (0.99 per cent).

Globally, Asian indices closed weak and Europe opened lower anticipating that the upcoming US employment data would give more evidence that growth is back in world's largest economy, said experts.

Indian shares fall for second day; elections, U.S. jobs data key

(Reuters) BSE Sensex fell for a second consecutive session on Wednesday as investors locked in profits in shares of blue chip companies such as ICICI Bank ahead of U.S. monthly jobs data and results of state elections due later in the week.

India's capital Delhi held local elections on Wednesday as part of a slew of state polls this month. Results will be declared on Sunday and investors will watch them for clues on how the world's biggest democracy is likely to vote in the general elections due by May next year.

Signs the country could be divided in elections could disrupt a rally that has seen shares gain nearly 20 percent since late August. Meanwhile, investors are also growing worried the Federal Reserve will soon start tapering its monetary stimulus, hurting foreign flows into emerging markets such as India. Fears of the withdrawal of this easy money roiled Indian markets during the summer, sending the rupee to a record low.

"As we enter the last month of 2013, we expect the market to respond to the outcome of state elections and comments from the Fed officials regarding the timing of the QE3 withdrawal," said Dipen Shah, head of private client group research at Kotak Securities.

The benchmark BSE index fell 0.7 percent, or 146.21 points, to end at 20,708.71, marking its lowest close in nearly a week.

The broader NSE index fell 0.66 percent, or 40.90 points, to end at 6,160.95, closing below the psychologically important 6,200 level.

Among blue chip shares, ICICI Bank Ltd fell 1.8 percent, while Larsen and Toubro Ltd ended down 1.5 percent. Meanwhile, ITC Ltd fell 2 percent while Hindustan Unilever Ltd ended 1.2 percent lower.

Maruti Suzuki India Ltd dropped 1.4 percent on continued pessimism after its sales in November fell by 10.7 percent and as the dollar rose against the yen.

Bajaj Auto Ltd declined 1.1 percent after the company said its November sales fell 17 percent. Rival Eicher Motors Ltd ended 4.1 percent lower on profit taking after marking an all-time high of 5,340 rupees on Tuesday.

Among the stocks that gained, VST Tillers Tractors Ltd rose 5 percent while miner Ashapura Minechem Ltd rallied 5.3 percent after large institutional investors bought stakes via block deals on Tuesday.