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Business News/ Market / Stock-market-news/  Sensex hits one-and-a-half-month low
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Sensex hits one-and-a-half-month low

The benchmark BSE index declines 0.30%, while the Nifty slides 0.34%

A file photo of the Bombay Stock Exchange. Sensex fell for a sixth day to mark its biggest losing streak since 21 November 2011. Photo: HT (HT)Premium
A file photo of the Bombay Stock Exchange. Sensex fell for a sixth day to mark its biggest losing streak since 21 November 2011. Photo: HT (HT)

Mumbai: Indian shares fell on Thursday to their lowest close in one-and-a-half months, led by a decline in banking stocks, after government estimates showed India’s FY13 growth could be worse than expected, while drug maker Cipla Ltd dropped after its October-December net profit missed estimates.

India’s slowest growth in a decade could be worse than anticipated preliminary data released on Thursday showed. The economy is set to grow 5.0% in the fiscal year ending next month, compared with central bank’s forecast of 5.5%.

Caution also prevailed as investors awaited the European Central Bank’s policy meeting later in the day and president Mario Draghi’s views on the region’s growth outlook. Analysts say consolidation is expected to continue ahead of the 2013/14 federal budget to be announced later this month, which is seen as a key test of the government’s commitments to shore up its finances.

“The market perhaps wants to consolidate before any next move, ahead of the Budget, which can be a bit populist," said Vijay Kedia, director at private wealth management firm Kedia Securities.

The key things to watch for now are how many more reforms come and how soon they get implemented, to stoke growth and avoid rating cuts, added Kedia.

Bank stocks such as ICICI Bank Ltd fell 0.84%, on concerns that growth is likely to slowdown even as inflation remains high, after government’s FY 13 gross domestic product estimates came in lower than market expectations.

Shares of Cipla fell 2.61%, a day after the company’s October-December net profit missed estimates, which were followed by downgrades from Morgan Stanley and CLSA citing lower-than-expected margins and earnings outlook.

State-run power utility NTPC Ltd shares fell 2.72% after its shares sale price was set at 145, or at a 4.5% discount to its Wednesday’s close.

NTPC’s weight in MSCI India index would rise from 0.63% to 1.79% as the company’s free float stock increases after its offer for sale, Citigroup said in a note, quoting MSCI.

Shares in Ambuja Cements Ltd fell 2.68% on expectations the company will post lower-than-expected earnings for the October-December quarter later in the day, dealers said.

India’s Strides Arcolab Ltd ended 12.52% lower, after falling as much as 17.4% in Mumbai trading earlier on Thursday, as investors cast doubts on media reports that the drug maker may sell its injectable-medicines unit Agila Specialties.

Telecoms shares fell, tracking the sixth straight monthly fall in India’s mobile phone subscriber base which declined by a net 25.88 million, or 2.9%, in December. Bharti Airtel fell 2%, while Idea Cellular Ltd ended 3.06% lower.

However, among the stocks that gained, Indian auto components maker Bharat Forge Ltd rose 1.05% after it said it was forming a joint venture with Israeli defence contractor Elbit Systems to supply advanced artillery and mortar systems to the Indian military.

Shares in ACC Ltd, controlled by Swiss group Holcim Ltd, the world’s second-largest cement producer, ended 0.8% higher after its October-December net profit, met expectations. Reuters

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Published: 07 Feb 2013, 10:02 AM IST
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