Sensex hits lowest level in more than five weeks

Mumbai: Indian shares fell 3.15 per cent to their lowest close in more than five weeks yesterday as investors braced for tough quarterly earnings, but scandal-scarred Satyam jumped 44 per cent on hopes a government-appointed board will rescue the company.

Traders said the broader market was also weighed down by concerns about tighter regulations and more negative disclosures by companies.

Shares in Satyam Computer Services jumped 44.2 per cent to Rs34.40 on hopes a newly constituted three-member board, appointed by the government, would help salvage the company's clients and staff.

Deepak Parekh, chairman of HDFC and a new director of Satyam, were expected to address a news conference at 5pm.

Satyam's market value had slumped to $330 million last week from more than $7 billion just six months ago following revelations of an accounting fraud.

Wipro shed 9.3 per cent to Rs227.35 after the No. 3 outsourcer said the World Bank had barred the company in June 2007 from direct contracts until 2011, citing a conflict of interest.

The 30-share BSE Index dropped 296.42 points to 9,110.05, its lowest close since December 5. It briefly pared losses to 0.8 per cent after industrial output unexpectedly rose in November, but then fell 4.1 per cent before pulling back.

"People are apprehensive there might be more such disclosures and there are wild rumours doing the rounds," said Gaurang Shah, chief manager at Geojit Financial Services.