Indian shares fall in volatile trade

Bangalore: Indian shares closed 0.14 per cent down after a see-saw day yesterday, shedding early gains of more than two per cent as jittery investors trimmed exposure in a market that has fallen 11 per cent over five sessions.

Engineering and construction firm Larsen & Toubro led the decline, while utility Reliance Power extended losses after tumbling on debut on Monday.

The benchmark BSE 30-share index ended down 22.90 points at 16,608.01, with 25 of its components in the negative. It rose as high as 16,966.72 during the day and fell to a low of 16,565.48.

"I believe it's a good opportunity to pick up leadership stocks because the excesses have played themselves out and the global equity markets are also stabilising somewhat," said Gajendra Nagpal, chief executive of Unicon Financial.

But the market is likely to remain volatile in the short-term amid global market turmoil as wary investors pocket gains on every rise, he said.

The BSE index is about 21.7 per cent below a record 21,206.77 hit on January 10. It has fallen about 18 per cent so far this year, after having risen 47 per cent in 2007. "There is a lack of confidence in the stock market and it's becoming so hard to convince retail investors to invest into equities. They are completely disillusioned."

The market saw short covering in select blue-chips that had fallen below the 200-day moving average, a technical support level, earlier yesterday, said Amitabh Chakraborty, president of equities at Religare Securities.

"Investors should not get very aggressive as the overall trend is still very uncertain and the risk aversion for foreign funds have increased," Chakraborty said.