Markets slump on dissapointing L&T results

BSE Realty and Capital Goods indices have slumped over 3% followed by counters like Oil & Gas, PSU, Power and Banks, all slipping by 1% each.

Benchmark indices have lost ground and are trading lower weighed down by disappointing Q4 numbers from L&T.

Larsen and Toubro Ltd posted a worse-than-expected 6.9% fall in quarterly profit as interest costs jumped for India's biggest engineering and construction company.

Net profit for fourth quarter fell to Rs 1,787 crore from Rs 1,920 crore last year, said the company, whose interests span shipbuilding to railways to real estate.

By 1440, Sensex plunged by 98 points at 20,014, and the Nifty down 38 points at 6,079 levels.

On the global front, Bank of Japan concluded its two-day policy meet with Governor Haruhiko Kuroda giving a go-ahead to monthly bond purchases in order to achieve 2 per cent inflation target.

Investors are now looking forward to US Federal Reserve chairman Ben Bernanke's testimony to US lawmakers and the minutes of the Fed's May meeting, both due later today for further clarification on stimulus measures and economic growth.

Asian shares gained momentum with Japan's Nikkei up 2% and Singapore’s Straits Times gained 0.5%. Trading on Hong Kong equity markets will be delayed due to a storm warning. The Shanghai Composite was trading flat with negative bias.

Back home, on the sectoral front, BSE Realty and Capital Goods indices have slumped over 3% followed by counters like Oil & Gas, PSU, Power and Banks, all slipping by 1% each. However, BSE FMCG and IT indices have gained by nearly 1% each.

Larsen and Toubro (L&T) has dipped over 5%, falling 7% from intra-day’s high after reporting a 7% year-on-year (y-o-y) drop in net profit at Rs 1,788 crore for the quarter ended March 31, 2013 (Q4) due to higher finance cost. The engineering major had profit of Rs 1,920 crore in a year ago quarter.

Other notable losers are Tata Power, Sterlite, RIL, GAIL, BHEL, Hero Moto and ONGC.

On the gaining side, Sun Pharmaceutical Industries has moved higher by 4%, crossing Rs 1,000 mark, at Rs 1,013 on the National Stock Exchange (NSE).

Shares of the state-owned oil marketing companies such as Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corporation (HPCL) and Indian Oil Corporation (IOC) are down more than 3% each on concerns of implementation of fuel pricing mechanism.

Among other shares, Styrolution ABS (India) has tanked 8.5% to Rs 435, extending its previous day’s 8.8% fall the company said bids received in offer-for-sale (OFS) at or above the clearing price of Rs 426 have been considered for allocation.

The market breadth in BSE remains weak with 1,356 shares declining and 873 shares advancing