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Markets drop 0.5%; techs fall, Bharti up

Markets drop 0.5%; techs fall, Bharti up
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First Published: Fri, Sep 09 2011. 11 41 AM IST
Updated: Fri, Sep 09 2011. 11 41 AM IST
Mumbai: Markets gave up early gains and fell on Friday as investors worried about the health of the global economy after western central banks steered clear of announcing fresh steps to boost growth.
By 10:49am, the 30-share BSE index was down 0.5% at 17,079.45 with 20 of its components declining, after initially rising 0.3%.
Investors were disappointed after a speech by the U.S. Federal Reserve chief lacked details on plans to spur economic growth after a $447 billion jobs package plan by US President Barack Obama.
Software stocks led losses on the main index with Infosys and Tata Consultancy Services dropping 2.1% each, while Wipro fell 1.4%.
The United States is the biggest market for India’s $76 billion information technology companies.
Global markets have been dominated in recent weeks by fears of a US relapse into recession and Europe’s snowballing debt crisis.
“The lack of any announcement on fresh measures by the US has led to the weakness we see currently. However, I expect some recovery during the day as the fundamentals of the Indian markets remain positive,” said S.P Tulsian, independent research analyst.
A pick-up in foreign fund inflows over the past few sessions have underpinned the market this week. Foreign funds bought just over $500 million of local stocks so far in September after selling $2.2 billion in the last month, according to data from the market regulator.
Leading mobile carrier Bharti Airtel rose 1.9% after it said it had secured a licence to operate 2G and 3G services in Rwanda and would invest $100 million in the African country over three years.
Energy major Reliance Industries dropped 1.7% after India’s federal auditor criticised the company and the government over development of the country’s key natural gas field in the Krishna Godavari (KG) basin and called for revamping profit sharing arrangements from oil and gas blocks.
The auditor report could form the basis of any possible government action against Reliance in future, analysts said.
Banking stocks remained mixed on expectations the central bank may again raise rates next week.
The Reserve Bank of India remains bent on fighting domestic inflation despite weakening global conditions, officials with direct knowledge of policymaking said on Wednesday. It is scheduled to review policy next Friday.
HDFC Bank fell 0.85%, while bigger rival ICICI Bank eased 0.2%. State Bank of India , the market leader, was up 0.3%.
Aluminium producer Hindalco traded 2.93% lower after Morgan Stanley downgraded it to ‘underweight´ from ‘overweight´ and slashed its price target by nearly half to 126 rupees from 236 rupees as it expects near-term roadblocks for the Indian aluminum industry, relating to coal and bauxite availability.
Indian shares have been one of the world’s worst performers this year, with the BSE index down more than 16%, as rising interest rates dented growth.
The 50-share NSE index was down 0.48% at 5,128.5. In the broader market, advancing stocks led declines 722 to 581 on volume of 192.6 million shares.
The MSCI’s measure of Asian markets other than Japan was down 0.26%, while Japan’s Nikkei was down 0.38%.
STOCKS
Delta Corp , which owns offshore casinos in Goa, jumped more than 5% after the Economic Times reported it was in talks with global casino players including Las Vegas-based MGM Resorts International and Caesars Entertainment to sell stake.
Shree Ganesh Jewellery House Ltd rallied 8% after the firm said it expects to triple turnover from retail segment to Rs 1,200 in the next two years.
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First Published: Fri, Sep 09 2011. 11 41 AM IST
More Topics: Markets Update | Asia | Oil | Bharti | US |