BackLenders drag Sensex to near two-week closing low
Lenders including HDFC Bank and SBI decline on worries over offloading of index futures by foreign investors
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Mumbai: The S&P BSE Sensex and CNX Nifty fell for a third straight session and closed at their lowest level in one-and-a-half weeks on Tuesday as lenders including HDFC Bank Ltd declined on worries over offloading of index futures by foreign investors.
Lenders led declines as they form a major portion of index futures, with HDFC Bank losing 1.30% to ₹ 715.90 and State Bank of India (SBI) ending down 1.9% at ₹ 2,065.30.
Foreign institutional investors (FIIs) sold index futures worth ₹ 1,170 crore over the previous two sessions, turning sellers for the first time since 16 April.
Overseas buying in cash shares also slowed to ₹ 77 crore on Monday from ₹ 257 crore on Friday.
A record-setting rally, driven by hopes of a revival in domestic economy and that the Bharatiya Janata Party (BJP) led by Narendra Modi will form the next government, is now chipping off as investors chose to book profit amid the January-March earnings season.
Subdued earnings from key companies, including Sesa Sterlite Ltd, Jindal Steel and Power Ltd, Hindustan Unilever Ltd and Dabur India Ltd, also dampened sentiment.
“There is a rotation of money happening in the earning season. Some profit-taking is underway which is not bad. Market is getting ready for the election results," said Deven Choksey, managing director at K.R. Choksey Securities.
The Sensex fell 0.73%, or 165.42 points, to 22,466.19, while the broader Nifty dropped 0.68%, or 46 points, to 6,715.25.
Both the indexes marked their lowest close since 16 April.
Caution also prevailed ahead of the US Federal Reserve’s two-day meet starting Tuesday, coming at a time of continued tensions between Russia and the West over Ukraine.
Among other bank stocks, Kotak Mahindra Bank Ltd fell 2.1% to ₹ 807.70 and IndusInd Bank Ltd ended down 1.7% at ₹ 485.55.
Consumer goods maker Hindustan Unilever Ltd (HUL) fell 3.01% to ₹ 563.15 following disappointment over its January-March sales volume growth.
ITC Ltd fell 0.50% to ₹ 340.35.
Sesa Sterlite fell 1.37% to ₹ 190.40 after the company’s January-March profit when adjusted for other income, lagged estimates.
Jindal Steel and Power slumped 7.41% to ₹ 253.20 after the company said its March-quarter profit fell by 47% to ₹ 403 crore.
Hexaware Technologies Ltd shares slumped 10.75% to ₹ 153.15 after the company’s March quarter profit declined 11.32% to ₹ 50.3 crore.
Bharti Airtel Ltd fell 0.81% to ₹ 335.15 on caution ahead of its quarterly earnings later in the day.
However, IRB Infrastructure Developers Ltd gained 2.65% to ₹ 119.95 after the company was selected as the preferred bidder to develop and run a toll road project worth ₹ 3,200 crore in Maharashtra. Reuters
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