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Markets end 2.4% down on poor quarterly results

Markets end 2.4% down on poor quarterly results
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First Published: Thu, Jan 21 2010. 05 52 PM IST
Updated: Thu, Jan 21 2010. 05 52 PM IST
Mumbai: Sensex fell for a third straight session, dropping 2.4% on Thursday to their lowest close in a month, with top engineering and construction firm Larsen & Toubro leading the losses, hurt by a decline in its quarterly net sales.
Subdued world equities also weighed on the sentiment. Asian markets other than Japan closed in the red, while emerging equity markets fell on worries China will take more measures to temper growth after reporting its fastest quarterly growth in two years.
Larsen & Toubro fell the most in six months as it dropped 6.9% to Rs1,524.35, as it reported a 6.1% drop in quarterly net sales and lowered its revenue guidance for the fiscal.
“The thing that went wrong was topline. It is easy to get orders, but implementing them is a difficult task,” said Anand Shah, head of equities at Canara Robeco Mutual Fund.
Shah added his fund portfolio does not contain any Larsen shares.
The 30-share BSE Index closed 423.35 points or 2.42% lower at 17,051.14, its lowest close since 22 December 2009 and its biggest percentage-point fall in 2 months. All of its components closed in the red.
“The market just required a negative trigger to fall after rallying last year. It was already tired, with no fresh flows coming in,” said R Ganesh, director of Mumbai-based brokerage Systematix Shares.
“Disappointing earnings from the capital goods sector just happened to be one of the reasons for that,” said Ganesh, adding global cues also did not provide any support.
Top private-sector lender ICICI Bank dropped 2.7% to Rs853.35, even as it posted a lower-than-expected 13.4% drop in quarterly net profit, as quality of its assets hurt, dealers said.
State-run power and engineering equipment firm Bharat Heavy Electricals declined 4.1 to Rs2,297.40 on broad market declines, even as it reported a 5.4% rise in its December quarter net profit, in line with street view.
Oil & Natural Gas Corp fell for the fifth straight session and closed nearly 2% lower at Rs1,140, ahead of its after-market quarterly earnings release.
The state-run explorer reported a 23% rise in third-quarter net profit, its second straight quarterly rise, helped by firmer oil prices, but lagged market estimates.
Energy giant Reliance Industries, which has the highest weight on the main index, dropped 2.2% to Rs1,053.80, ahead of its quarterly results on Friday.
In the broader market, four shares declined for every one share that advanced in a volume of 510 million shares, lower than last week’s daily average of 651 million shares.
The 50-share NSE index closed 2.4% lower at 5,094.15.
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First Published: Thu, Jan 21 2010. 05 52 PM IST
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