Sensex down over 100 pts; IT & auto shares drag

Benchmark indices continue to trade lower weighed down by Asian shares along with IT and auto shares leading the fall.

At 11:20 AM, the 30-share Sensex was down 120 points at 20,745 and the Nifty slipped 36 points at 6,166.

On the global front, Asian shares pared gains and the dollar plumbed a fresh two-year low against the euro on Wednesday after disappointing US jobs data vanquished any expectations that the Federal Reserve will taper its stimulus before next year.

Japan's Nikkei share average dropped 1% as a stronger yen took a heavy toll, but earlier touched a 3-1/2 week high.

Back home, the rupee is off highs on dollar bids from state-run banks for defence purchases of the government, other importers. The USD/INR pair is at 61.30/31, off 61.05 highs. The unit closed at 61.655/665 per dollar on Tuesday.

On the sectoral front, BSE Realty, Auto, IT, TECk, Capital Goods and Power indices have plunged between 0.5-1.4%. However, BSE Metal, Bankex, PSU and Consumer Durables indices are trading in positive zone.

IT majors are down on account of profit booking after recent gains in the run up to the second quarter earnings.

Wipro has dipped over 5% to Rs 487 on NSE on profit booking after reporting a better-than-expected 19% quarter-on-quarter (qoq) jump in consolidated net profit at Rs 1,932 crore for the second quarter ended September 2013 (Q2) against Rs 1,623 crore in March quarter. Analyst on an average had expected profit of Rs 1,803 crore for the quarter. TCS and Infosys are down by 1%.

Auto majors like Bajaj Auto, Tata Motors, Maruti Suzuki and Hero Moto have declined between 1-2%.

Other notable gainers are Dr Reddy’s Lab, HUL, Sun Pharma, HDFC and NTPC.

On the gaining side, GAIL (India) is trading higher by 3.5% to Rs 346 on NSE on reports that the government may exempt the state-owned company from sharing subsidy burden.

SBI, Sesa Sterlite, Cipla and Tata Power have gained between 1-3%.

Banking shares mainly public sector undertakings (PSU) are trading higher in otherwise subdued market on reports that the government has finalized Rs 14,000 crore capital infusion plan.

Bank of Baroda, Canara Bank, Punjab National Bank, Bank of India and Union Bank of India are up 1-3% on the National Stock Exchange (NSE).

The broader markets continue to outperform the benchmark indices- BSE Midcap and Smallcap indices are up 0.1-0.2%.

The market breadth in BSE remains positive with 963 shares advancing and 800 shares declining.