Business | Markets
Stocks slump after two-day rally
Indian stocks fell, with the benchmark index snapping a two-day, 6.7 per cent rally. Bharti Airtel Ltd and Reliance Communications Ltd, India's two biggest mobile-phone operators, dropped after they had their price targets cut at Goldman Sachs Group Inc.
- Bloomberg
- Published: 22:59 January 29, 2009
Mumbai: Indian stocks fell, with the benchmark index snapping a two-day, 6.7 per cent rally. Bharti Airtel Ltd and Reliance Communications Ltd, India's two biggest mobile-phone operators, dropped after they had their price targets cut at Goldman Sachs Group Inc.
DLF Ltd, India's biggest real estate developer, declined after its share price forecast was reduced at Morgan Stanley, which said weak demand for property will damp profits. DLF will report earnings tomorrow.
"We are seeing demand declining and revenue contracting," said Mahesh Patil, who helps manage the equivalent of $8.8 billion (Dh32.32 billion) at Birla Sunlife Asset Management in Mumbai. "Cost pressures are high, now with demand declining it will create a problem."
Mahindra & Mahindra Ltd, the largest local maker of sport-utility vehicles (SUV), led automakers higher after the government cut retail fuel prices for the second time in less than two months.
The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 21.19, or 0.2 per cent, to 9,236.28. The S&P CNX Nifty Index on the National Stock Exchange fell 25.55, or 0.9 per cent, to 2,823.95. The BSE 200 Index slid 0.5 per cent to 1,086.02.
India's rupee dropped for the first time this week as overseas investors increased equity sales.
The currency fell after data from the nation's capital markets regulator showed funds based abroad sold more Indian shares than they bought for the eighth straight day on Tuesday.
"The equity market sentiment remains jittery and that continues to influence the undercurrent in the currency market," said Roy Paul, assistant manager of treasury at Federal Bank Ltd in Mumbai.
The rupee declined 0.1 per cent to 48.985 per dollar at the 5pm close (3.30pm UAE time) in Mumbai, according to data compiled by Bloomberg. The currency has slipped 0.4 per cent this year, extending last year's 19.2 per cent loss, which was the most since 1991.
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