Mumbai: The market lost ground for first time in last seven trading sessions due to profit booking in private banks, FMCG, oil and select pharma stocks. However, metals stocks bucked the trend.
The 30-share BSE Sensex fell 190.04 points or 0.70 percent to 26845.81 after rallying more than 1400 points in previous six consecutive sessions. The 50-share NSE Nifty declined 48.05 points or 0.59 percent to 8129.35. The BSE Midcap index underperformed benchmarks, losing 1 percent.
Overall it was a consolidation ahead of September quarter earnings that will begin on Monday with Infosys numbers, feel experts, saying upside may be capped at 8400.
Saurabh Mukherjea of Ambit Capital says 22000 on the Sensex is a distinct possibility, given the current global challenges . Abhay Laijawala, Deutsche Bank says earnings estimates suggest that weak trend in revenue and earnings growth is likely to extend further into September 2015. He expects September 2015 Sensex revenue growth to come in at the lowest level in the post-2008 era hit again by a muted demand environment and subdued prices, reflecting in the poor revenue growth of oil & gas and metal companies in Sensex.
It was mixed day for global equities. In Asia, China's Shanghai Composite rallied 3 percent after the week long holiday but Nikkei and Hang Seng ended weak, down 0.7-1 percent. European markets were volatile but recovered from early lows despite weak German export numbers.
Exports in Germany plunged 5.2 percent in August, the biggest fall since the global financial crisis. Back home, there was a big relief for Vodafone in the Rs 8,500 crore transfer pricing case with respect to its BPO business. The Bombay High Court ruled in favour of the telecom giant.
Index heavyweights Reliance Industries (down 2.7 percent), ITC (down 2.06 percent) and ICICI Bank (down 1.57 percent) were the biggest contributors to Sensex's fall. Sun Pharma, Axis Bank, M&M, Lupin and GAIL dropped 1-2.5 percent. Metals stocks outperformed with the Vedanta rising more than 2 percent. Tata Steel gained 1.6 percent as the company settled pension overhang in UK.
JP Morgan believes this is a very positive development as it reduced their debt assumptions by 460 million pound. Tata Motors gained for the fourth consecutive session today, rising 0.5 percent on top of 15 percent upside in previous three sessions.
Reliance Communications and MTS have moved closer towards a merger. CNBC-TV18 learnt that boards of both companies have completed due diligence and are likely to meet next month to finalise merger outline. MTS and the Russian government are likely to have two board seats in the combined entity. The stock was up half a percent. Declining shares outnumbered advancing ones by a ratio of 1478 to 1264 on the Bombay Stock Exchange.
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