Mumbai: The BSE Sensex fell as recent gainers such as Reliance Industries Ltd were hit by profit-booking, while information technology (IT) stocks fell due to concerns about their outlooks on a day in which the expiry of derivatives led to record volumes in the futures and options (F&O) segment.
Turnover in F&O on Thursday reached around Rs.4.2 trillion, three traders said, as December contracts expired, leading to rollovers into the January 2013 series.
Caution also prevailed with only three trading sessions left in 2012, as the “US cliff” negotiations continue, while the strong foreign buying that has helped sustain Indian stocks could peter out as investors close their books.
“There seems to be the lot of unwinding of the long outstanding contract to start with new slate, resulting in the highest turnover on Thursday,” said K.K. Mital head of portfolio management at Globe Capital.
The BSE Sensex fell 0.48%, or 93.66 points, to end at 19,323.80.
The broader Nifty fell 0.6%, or 35.50 points, to end at 5,870.10, ending below the psychological level of 5,900 points.
The BSE Sensex has gained around 25% this year, backed by about $24 billion in foreign buying across domestic equities.
Although expected interest rate cuts in January could support shares, investors also remain wary about growth, especially after Prime Minister Manmohan Singh on Thursday called a five-year plan for average growth of 8% “ambitious.
Among decliners on Thursday, RIL fell 1.3% hit by profit taking after shares gained 4.4% so this month as of Wednesday, trumping a 0.2% fall in the NSE index.
Other shares that were hit by profit-taking included Mahindra and Mahindra Ltd, which fell 1.5%, and Hindustan Unilever Ltd, which ended down 1%.
Technology shares extended falls on caution ahead of their earnings results next month and uncertainty about their 2013 outlooks.
However, among gainers, Tata Motors Ltd shares gained 1% as hopes for a better outlook in 2013 for key unit Jaguar Land Rover led investors to roll over their derivatives positions, according to traders.
Clariant Chemicals India Ltd shares gained 1.5% after the company said SK capital will buy its textile chemicals and paper specialities unit. Financial details were not provided.
Kalpataru Power Transmission Ltd shares gained 2% after the company said in a statement it received orders worth over Rs.955 crore. Reuters