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Markets snap 3-day rise, drop 0.8%

Markets snap 3-day rise, drop 0.8%
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First Published: Wed, Feb 10 2010. 10 47 PM IST
Updated: Wed, Feb 10 2010. 10 47 PM IST
Mumbai: Indian shares snapped a three-day rise and fell 0.8% on Wednesday, weighed down by waning foreign appetite and worries about the health of some euro zone economies.
Jigar Shah, vice-president of equity sales at brokerage Motilal Oswal, said heavy selling by foreign funds over the past few weeks was putting pressure on the market.
“There is going to be a downward trend, until we have some clarity on the global front,” he said.
Financials led the decline, with the banking sector index shedding 0.8% after gaining 1.7% over the last three sessions.
State Bank of India and ICICI Bank fell 2.1% and 1.3% respectively.
The BSE 30-share index Sensex closed down 0.75%, or 120.01 points, at 15,922.17. Only eight of its components closed in the green.
Data showed foreign funds had pulled out $1.9 billion over the past 11 sessions, pushing the benchmark index down nearly 9% this year.
In 2009, the index had jumped 81% as foreign investors poured $17.5 billion into the market.
Finance minister Pranab Mukherjee pegged 2009-10 economic growth at around 7.75%, higher than the government’s forecast but in line with the central bank’s projection.
Traders said domestic funds have been buying as Asia’s third-largest economy picks up momentum, but investors were cautious due to the foreign withdrawals and the annual budget on 26 February.
C. Rangarajan, chairman of the Prime Minister’s Economic Advisory Council said the budget could provide a roadmap for exiting stimulus measures.
Energy giant Reliance Industries, which has the highest weight on the Sensex, closed 0.9% lower at Rs984.65.
Metal makers rose after base metals prices firmed, shrugging off lower-than-expected Chinese copper imports from January.
Non-ferrous metals producer Sterlite Industries and aluminium maker Hindalco gained 0.9% and 1.7% respectively.
In the broader market, decliners outnumbered gainers in the ratio of 1.1:1 on volume of 373 million shares, lower than last week’s daily average of 394 million shares.
The NSE 50-share index Nifty dropped 0.7% to 4,757.20.
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First Published: Wed, Feb 10 2010. 10 47 PM IST
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