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Business News/ Money / Personal-finance/  Profit-taking clips markets; Infosys shines
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Profit-taking clips markets; Infosys shines

Profit-taking clips markets; Infosys shines

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Mumbai: Indian shares fell 0.9% on Thursday as investors locked in profits after the main index climbed to a 33-month high in early trade, but the undertone remained upbeat on sustained foreign buying.

Outsourcers mostly rose with bluechip Infosys Technologies, the No.2 software services exporter, climbing to an all-time peak ahead of quarterly earnings due before the market opens on Friday.

Ramesh, the chief operating officer of Kotak Mahindra Capital, says that while liquidity has been pouring into India from abroad, he sees no concerns that a bubble is in the offing:

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Engineering and construction conglomerate Larsen & Toubro, ICICI Bank, State Bank of India, HDFC Bank and Housing Development Finance Corp shed ground after posting big gains this year.

“Some profit booking was expected after such a run up, but there is no big concern in the market for now," said Neeraj Dewan, director of Quantum Securities.

The 30-share BSE index closed down 0.92%, or 190.24 points, at 20,497.64 points, with 25 of its components losing ground. It had hit 20,854.55 early, just around 350 points from a record high of 21,206.77 reached on 10 January, 2008. The 50-share NSE index closed 0.9% lower at 6,177.35 points.

Citigroup estimated companies, excluding oil firms, in the index would post annual earnings growth of more than 40% this year, with quarter-on-quarter rise of 9%.

“India’s 2QFY11 should be making headlines and hitting highs," it said in a note dated 7 October.

Foreign funds have invested a record $21.8 billion in Indian equities so far this year, and helped the benchmark index rise 17.4%.

Infosys gained as much as 2.4% to a record high of Rs3,228 while smaller rival Wipro firmed as much as 3.6% to 499.90, its highest in a decade.

Brokerages expect Infosys will raise its outlook for dollar revenue growth to 21-24% for this fiscal year from 19-21% forecast in July.

The banking sector index shed 1.1%, but is still up 42.8% in the year to date. State Bank of India dropped 1.3%, while ICICI Bank and HDFC Bank declined 1.8% and 0.9% respectively. HDFC shed 1.1%.

Larsen & Toubro dropped 3.2%, after rising 4% in the previous session.

Provisional data showed declining shares outnumbered advancing ones in a ratio of 1.6:1 on relatively heavy volume of 647 million shares.

MSCI’s all-country world index firmed 0.7% at 3:43pm, while MSCI’s emerging market benchmark was trading 0.9% higher.

STOCKS THAT MOVED

Software services firm Mastek fell 3.3% to Rs235.85 after it posted a surprise loss in the September quarter, hurt by lower development revenue from a major client and annual wage hikes.

Infotech Enterprises shed 7.6% to Rs174.75 as the engineering software services provider said its July-September net profit dropped 6.6%.

LIC Housing Finance gained nearly 1% to Rs1,458.05 as the mortgage lender posted a forecast-beating 36% rise in quarterly net profit.

Road builder Ashoka Buildcon closed up 2.9% at Rs333.35 on market debut, compared with the issue price of 324.

Bedmutha Industries, a steel wire manufacturer in western India, gained 77.3% on debut to Rs180.80 from its issue price of 102.

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Published: 14 Oct 2010, 11:40 PM IST
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