Sensex fall after attacks, hotels plunge

Sensex fall after attacks, hotels plunge

Bangalore: Indian shares fell on Friday after militant attacks on the financial capital of Mumbai killed at least 121 people and shut down the market for a day, rattling investors.

Shares in Indian Hotels Co Ltd fell 13.5% to Rs41.90 and was down 4.6% at Rs88.60 after their main hotels - Taj Mahal Hotel and Oberoi-Trident were damaged by the attacks.

By 12pm, the 30-share BSE index was down 0.64%, or 57.54 points, at 8,969.18, with 20 stocks losing ground. It opened down 1.5% and then rose as much as 0.6%.

The broader 50-share NSE index was down 0.44% at 2,740.05

Traders said short covering ahead of the expiry of monthly derivatives and better-than-expected economic growth in the September quarter helped the market to pull back, but the outlook for the near term was weighed down by greater political risks.

Volume was below normal at 66 million shares in the broader market, where losers led gainers two to one.

Outsourcers such as Infosys Technologies rose 3.2% to Rs1,225 and Tata Consultancy Services was up 4.2% at Rs549, as investors hunted for bargains in battered stocks, traders said.

Data showed India’s economy grew 7.6% in the September quarter from a year earlier, above market expectations for 7.3% but below the preceding quarter’s 7.9% rise.

Analysts said Mumbai was no stranger to political violence and markets had usually regarded previous bombings and other attacks with a degree of nonchalance.

Still, investors will be cautious.

Foreign funds have withdrawn a net $13.7 billion from Indian shares this year, pushing the BSE index down 55%.