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Wednesday September 2, 11:50 AM
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BSE Sensex seesaws; Reliance Ind, Bharti drop
MUMBAI (Reuters) - The BSE Sensex (^BSESN : 16632.01 -222.92
) was choppy on Wednesday, as a slide on Wall Street overnight on concerns about the U.S. financial sector kept investors wary across Asia.
Private-sector lender ICICI Bank (ICICIBANK.NS : 850.9 -14.6) fell 1.3 percent to 735 rupees and engineering and construction firm Larsen & Toubro (LT.NS : 1589.45 -41.65) dropped 0.9 percent to 1,536.20 rupees, leading losers in the main index.
Energy giant Reliance Industries (RELIANCE.NS : 1045.95 -17.8), which has the most weight in the main index, was down 0.9 percent at 1,963.85 rupees.
Top telecoms firm Bharti Airtel (BHARTIARTL.BO : 283.65 +2.65
), which is in exclusive merger talks with South Africa's MTN, eased 0.5 percent to 419.70 rupees.
"The market is trying to find its feet after the recent rally," Sonam Udasi, vice president of research at BRICS Securities, said.
"Definitely now there are signs of fatigue, but longer term, the prospects are still in place."
No. 2 telecoms firm Reliance Communications (RCOM.NS : 166.6 -1.5) gained 3.5 percent to 273.10 rupees, after it said on Tuesday it had repaid early more than $1 billion of loans, about one-fifth of its outstanding loans, and could repay more debt ahead of schedule.
The company's telecoms tower unit has revived its initial public offer plan and is looking to raise up to 50 billion rupees ($1 billion), the Business Standard reported.
By 11:20 a.m. (0550 GMT), the 30-share BSE index was down 0.2 percent at 15,517.79 points, with 18 stocks declining, after rising as much as 0.3 percent earlier.
The benchmark has fallen 2.3 percent over the past two sessions, after rising for seven straight days for the first time in 4-½ months, as profit-taking emerged in equity markets worldwide after a recent rally.
Morgan Stanley said it had cut India's economic growth forecast to 5.8 percent in 2009/10 from its earlier projection of 6.4 percent, in anticipation of a drop in agricultural output.
Analysts say a rush of liquidity pouring into emerging markets will support stocks in the near term as investors look to buy on dips even though worries about a weak monsoon, high valuations and looming inflation weigh.
"World over economists seem to be in a dilemma. On the one side, it looks like conditions are improving, but on the other hand there are those who say we are headed for much worse," Udasi said.
Manufacturers from several countries including the United States produced some upbeat news on Tuesday, indicating that a recovery from the deepest global downturn since World War Two is slowly gaining traction.
Some fretted, though, that the recovery leans too heavily on expensive government efforts -- from the popular U.S. "cash forclunkers" auto sales incentives to a pre-election propping up of Germany's labour markets.
And the reports were not enough to support global equities, which fell heavily on worries that investors have gotten ahead of themselves in pricing in a recovery.
In the broader market, losers led gainers 1,369 to 961 on relatively moderate volume of 158.3 million shares.
The 50-share NSE (^NSEI : 4941.75 -63.8) index was down 0.1 percent at 4,620.55.
Most Asian markets were lower, with Japan's Nikkei down 2.6 percent, while MSCI's measure of other Asian markets fell 1.5 percent.
The S&P 500 fell 2.2 percent on Tuesday to 998.04 as scepticism that stocks can add to a nearly 50 percent rally over the last six months prevailed in the market.
MAIN TOP 3 BY VOLUME
* NHPC Ltd on 15.9 million shares
* Unitech on 8.1 million shares
* Mahindra Satyam (SATYAM.BO : 90.55 -2.2) on 5.9 million shares
STOCKS ON THE MOVE
* Non-ferrous metals producer Sterlite Industries shed 1.7 percent to 644.60 rupees as Shanghai copper futures fell 4.5 percent, chasing a similar slide in London metal.
* Drugmakers Ranbaxy Laboratories rose 0.8 percent to 322.20 rupees, and Strides Arcolab advanced 2.5 percent to 156.50 rupees after the companies got government orders to supply the generic version of Roche's anti-viral, Tamiflu, used to treat the H1N1 flu.
* Pratibha Industries Ltd gained 4.8 percent to 207.85 rupees after the company said it won an order worth 4.06 billion rupees.
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