Markets extend losses to 1% on bank losses

Markets extend losses to 1% on bank losses

Mumbai: Indian shares extended losses to 1% on Thursday afternoon, led by losses in banks, mirroring the decline in world equities.

At 2:16pm, the 30-share BSE index was down 1.07% at 16,828.02 points, with 22 components in the red. The 50-share NSE Index was down 1.25 percent at 5,000.20.

Asian market were weak with China’s growth data failing to surprise, and a late-sell off in financial shares led to an overnight decline on the Wall Street.

Leading banks State Bank of India and ICICI Bank, which saw a steep rise recently, fell as investors locked profits.

Meanwhile, Moody’s Investors Service on Wednesday downgraded the supported ratings of 13 Indian commercial banks after its global review of systemic support indicators for individual banking systems.

India’s wholesale price index rose 1.21% in the 12 months to 10 October, higher than previous week’s annual rise of 0.92 percent, government data showed.

By 1:13pm, the 30-share BSE Index was trading down 0.6 percent at 16,906.61, with 16 of its components declining. The 50-share NSE index was down 0.74% at 5,026.10.

“We had raced to 17-month highs. So, this kind of profit booking is only fair to the market," said Gajendra Nagpal, CEO of Unicon Financial. “A severe fall is not likely, but we may see such bouts of profit sales," he added.

State Bank dropped 1.27% while ICICI Bank declined 2.2%. Energy giant Reliance Industries was down 1.14% at Rs2,157.50 while the Supreme Court continues to hear its arguments in its gas supply dispute with Reliance Natural Resources.

Engineering and Construction firm Larsen & Toubro was down 3.3% at 1,618.10 rupees, as it reported its September quarter net profit rose 26% to Rs580 crore.

Rival Jaiprakash Associates declined as much as 6.5% to Rs239.10 as dealers said its second-quarter results disappointed even though it declared a bonus share issue.

“On the bottom-line front, the performance was below our expectations, due to the hit in margins and the increase in interest cost," Angel Broking, which has a ’reduce’ rating on the stock, said in a note. The stock was trading 5.7% lower at Rs241.20.