Sensex falls for sixth day; RBI rate review key

The BSE Sensex fell for a sixth consecutive session on Tuesday as rate-sensitive stocks such as HDFC Bank continued to tumble a day before the Reserve Bank of India is widely expected to raise interest rates at its policy review.

Most analysts in a Reuters poll expect the central bank to lift the repo rate by 25 basis points to eight per cent, its third consecutive rate hike, after both consumer and wholesale prices surged last month.

The benchmark BSE index fell 0.23 per cent, or 47.38 points, to end at 20,612.14, its lowest close since November 28 after earlier gaining as much as 0.6 per cent during the day. The BSE index is now 4.1 per cent away from the record high. The broader NSE index ended 0.25 per cent lower, or 15.65 points, to end at 6,139.05.

Bank shares fell 1.4 per cent, having declined in five of the past six sessions, on continued risk aversion ahead of the RBI's policy decision due on Wednesday. Software services exporters such as HCL Technologies fell 1.3 per cent on profit-taking after earlier hitting a record high of Rs 1,198 in the session. Wipro also declined 1.2 per cent after earlier touching its highest level since March 2000.

However, Tata Consultancy Services gained 1.3 per cent after analysts cited company executives as saying October-December revenue was broadly in line with seasonal trends despite seasonal weakness.

TCS executives were also positive about the demand environment, according to the analysts.

Among other stocks that gained, Apollo Tyres rose 2.2 per cent after Cooper Tire & Rubber Co lost its US court bid on Monday to force the Indian tyremaker to complete their proposed $2.3 billion merger.

Mahindra & Mahindra Financial Services Ltd rose 1.1 per cent after its inclusion in National Stock Exchange's derivatives market, dealers said.