Markets turn negative; ICICI, Tata Motors drop

Markets turn negative; ICICI, Tata Motors drop

Mumbai: Indian shares turned negative on Thursday afternoon as investors took profits in stocks such as ICICI Bank and Tata Motors that had risen sharply over the past few sessions.

At 2:48pm, the 30-share BSE index was down 0.14% at 17,146.26 points, with half of its components declining. The 50-share NSE index was down 0.2% at 5,122.45.

Indian shares had extended gains to 1% in the afternoon, led by banks and Reliance Industries, a rise in Asian shares and hopes European markets would also strengthen.

At 1:03pm, the 30-share BSE index was up 1.09% at 17,357.61 points, with 27 components rising. The 50-share NSE index was up 1.06% at 5,177.50.

Investor confidence has been upbeat this week after economic growth in the September quarter leapt a better-than-expected 7.9%, and auto sales in November showed another big rise.

“The positive data we saw this week is boosting sentiment ... supported by continued liquidity inflow," said Ambareesh Baliga, vice-president of Karvy Stock Broking.

The benchmark has gained 80% so far in 2009, as foreign funds poured nearly $16 billion into Indian equities.

“Good numbers have raised expectations, but will they be met is the question," said Baliga. “When that does not happen, the market punishes the respective sectors."

Banks continued their rally as robust economic growth boosted their outlook, traders said.

The sector index was up 0.8%, taking the gains so far this week to more than 5%.

Top lender State Bank of India was up 0.9% at Rs2,328.40 and rival ICICI Bank climbed 0.6% to Rs898.50.

Reliance Industries was up 0.7% at Rs1,108.00 on better prospects as it steps up gas output from its field off the east coast.

“We believe RIL’s growth trajectory should revive from H2FY10 owing to stable operations at near full capacity of all units in RPL (Reliance Petroleum) coupled with gradual revival in refining outlook and the ramp in KG D6 volumes to peak volumes." Deutsche Bank said in a note on Wednesday.

It upgraded Reliance Industries to buy from hold.

In the broader market, gainers were more than twice the number of losers on volume of 189 million shares.