Reliance and ICICI lead losers on Sensex

New Delhi: Indian shares snapped a two-day rise and fell 1.7 per cent on Monday, as investors took cues from wobbly world markets but real estate firms rose on expectations for more rate cuts.

Index heavyweights Reliance Industries and ICICI Bank led the losses by falling 4.8 per cent and 5.5 per cent respectively.

But Cairn India rose 4.7 per cent to Rs160.1 after the explorer, a unit of Britain's Cairn Energy, said it had found oil and gas near its existing field in the western Indian state of Raj-asthan.

The 30-share BSE index ended down 171.56 points at 9,928.35, with 23 components falling. The benchmark opened flat, seesawed and slipped sharply after European markets opened lower.

"The market has moved up quite a bit and now with the holiday season due, market has developed some kind of fatigue," said Gajendra Nagpal, chief executive at Unicon Financial. "Not much selling is happening, but there is lack of buying interest."

Top listed realty DLF climbed 2.7 per cent to Rs315.75, while rival Uni-tech gained 3.4 per cent to Rs45.75 on hopes for a cut in interest rates.

DLF gains

High lending rates have slowed the sale of houses and commercial properties and dampened the realty firms' earnings. DLF is down about 70 per cent on the year, while Unitech has tumbled 90 per cent.

Top lender State Bank of India said on the weekend it would cut lending rates by 75 basis points from January 1, which raised expectations other state-run banks would follow suit.

Its shares ended down one per cent at Rs1,274.35 after rising 2.7 per cent during trade.

The 50-share NSE index fell 1.24 per cent to 3,039.30.