Markets end lower dragged by IT shares

Benchmark share indices ended lower on Thursday, shrugging of better-than-expected November industrial production data, with Infosys leading the decline after the software major cut its dollar revenue growth guidance for fiscal 2012 because of the debt crisis in Europe.

Meanwhile,  India’s industrial production for the month of November grew at 5.9% beating the street expectations after a sharp contraction last month.

Further food inflation for the week ended December 31, 2011 came in at -2.9% compared to -3.36% during the previous week.

IT major Infosys reported a quarter-on-quarter growth of 25% in net profit to Rs 2,372 crore for the quarter ended December 31, 2011. In the previous quarter its net profit was Rs 1,906 crore. But the company cut its FY12 dollar revenue growth guidance to 16.4% as against earlier guidance of 17.1-19.1%.

According to Sanjeev Hota, AVP Research with Sharekhan, "Infosys has not been able to achieve a growth higher than 3 per cent and we were expecting around 4 per cent growth in volume."

The BSE IT index was the top sectoral loser, down nearly 6% or 348 points at 5,484 levels.

Infosys was the top loser among the Sensex stocks, down 8.4% to Rs 2,588. Among other software shares, TCS lost nearly 4% to end at Rs1,093 and Wipro ended 2.6% lower at Rs 391.

Among other Sensex shares, heavyweight Reliance Industries, Larsen & Toubro, BHEL, ONGC, Sun Pharma, Cipla and Jindal Steel ended lower.

State Bank of India was the top gainer, up 2% to Rs 1,761 after the bank said it's non-performing assets are under control after remedial measures were taken. HDFC and HDFC Bank were both up nearly 1% each after HDFC reported 10.1% increase in net profit at Rs 981 crore for the quarter ended December, 2011. In the same period a year ago it was Rs 891 crore.

Sensex gainers include ITC, Tata Steel, Bajaj Auto, Sterlite Industries, NTPC, Mahindra & Mahindra and Tata Motors.

At the same time, BSE Power was the top sectoral gainer, up 1.3% at 1,954 levels after electricity sector reported 14.6% year-on-year growth in November 2011 against 5.5% growth in October.

ABB, GMR Infra, Lanco Infra, Crompton Greaves, Adani Power and PTC India were among the top gainers from the power space.

Metal, Bankex, Auto, PSU, FMCG, Consumer Durables, Realty and Healthcare indices are also ended on a firm note.

Smart Movers

Shares of Vijay Mallya-led UB Group such as United Breweries, United Breweries Holdings, McDowell Holdings and UB Engineering rallied more than 10% each on back of huge volumes.

GMR Infrastructure surged 6% at Rs 28, extending its four day 16% rally, on buzz of a proposed increase in tariff at the Delhi International Airport (DIAL) by Airports Economic Regulatory Authority .

TTK Prestige dropped 7.6% to end at Rs 2,320 despite the consumer durables company reporting a 18% jump in the net profit during the third quarter ended December 2011.

The broader markets ended on a flat note, the BSE mid-cap index ended at 5,519, up 14 points and the small-cap index added 9 points to close at 6,084 levels.

The overall market breadth was marginally positive as 1,422 stocks advanced while 1,310 stocks declined.