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Markets surrender early gains and head lower

Markets surrender early gains and head lower
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First Published: Wed, Feb 10 2010. 11 38 AM IST
Updated: Wed, Feb 10 2010. 11 38 AM IST
Mumbai: Indian shares edged lower on Wednesday morning, unable to hold on to opening gains after rising for the past three sessions as nervous investors worried about whether a return of risk appetite would be sustained.
Banks led the decline. The sector index was down 0.4% after gaining 1.7% over last three sessions.
Leading lenders State Bank of India and ICICI Bank shed 0.7% and 0.3% respectively.
At 10:10am, the 30-share BSE Index was down 0.3% at 15,993.28, with 21 components declining. The 50-share NSE index was down 0.2% at 4,782.25.
“The sentiment is still affected and the mood is still not positive as the worries in Europe are not completely resolved,” said K. K. Mital, head of portfolio management services at Globe Capital.
“Risk aversion is continuing and money is moving out of equities,” he said, noting that Asian markets had also come off their early highs.
Reports of a rescue plan for debt-trapped Greece had eased concerns about global economic stability and boosted markets.
Export-oriented software firms erased some of Tuesday’s gains. Tata Consultancy Services dropped 0.2 percent while Infosys Technologies and Wipro fell 0.1 and 0.6% respectively.
“It is just some profit booking, after the brief pullback. Volatility will continue until the budget comes in,” said Daljeet Kohli, head of research for private client group at Emkay Global.
The budget on 26 February could outline plans for an exit from fiscal stimulus, C. Rangarajan, chairman of the Prime Minister’s Economic Advisory Council told reporters.
Tata Steel, world’s eighth-largest steel maker by output, climbed 0.9% to Rs538.30. Earlier this week, Goldman Sachs upgraded Tata Steel to “buy” from “neutral” and raised its 12-month target price to Rs702 from Rs496.
Goldman Sachs said the upgrade was based on sustained strong profitability at its India business and a constructive outlook for the European steel sector.
In the broader market, gainers were almost double the number of losers on a volume of 80 million shares.
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First Published: Wed, Feb 10 2010. 11 38 AM IST
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