Sensex falls over 100 points; banks & auto shares drag

The Sensex is down by 127 points at 28,724 and the Nifty has slipped 48 points at 8,664

Benchmark indices have extended losses and are trading near day’s low weighed down by selling pressure among auto and bank shares.

By 10:50, the Sensex was lower by 127 points at 28,724 mark and the Nifty has slipped 48 points at 8,664.

Among broader markets, BSE Midcap and Smallcap indices are underforming the benchmark indices- BSE Midcap and Smallcap indices have plunged over 1% each.

Markets breadth on the BSE has turned weak with 1,551 shares declining and 620 shares advancing.

Meanwhile, foreign portfolio investors sold shares worth a net Rs 27.43 crore yesterday, 5 February 2015, as per provisional data.

On the sectoral front, BSE Auto, Bankex, Healthcare, Metal and Realty indices have slipped between 1-3%. However, BSE FMCG and IT indices are up 1% each.

From the Auto space, Tata Motors, M&M, Hero Moto, Bajaj Auto and Maruti Suzuki have slipped between 1-6%.

Shares of Tata Motors are trading lower by 6% after India’s biggest automobile manufacturer missed estimates by a huge margin.

Net profit fell 25.5 per cent to Rs 3,581 crore from Rs 4,804 crore in the year-ago period. Bloomberg had estimated net profit at Rs 4,972 crore.

Unfavourable revaluations of foreign currency debt, unrealised hedges, higher depreciation and amortisation and a provision for capital cost of buildings at Singur, amounting to Rs 310 crore, also impacted margins and profits.

Among banks, Axis Bank, HDFC Bank, SBI and ICICI Bank have dipped between 1-3%.

Banking stocks are in focus after the Reserve Bank of India (RBI) yesterday said in its guidelines for implementation of Countercyclical Capital Buffer (CCCB) that the CCCB may be maintained in the form of Common Equity Tier 1 (CET 1) capital or other fully loss absorbing capital only, and that the amount of the CCCB may vary from 0 to 2.5% of total risk weighted assets (RWA) of the banks.

GAIL, Tata Steel and NMDC are due to post its Q3 results later during the day. GAIl and Tata Steel have slipped between 1-3%.

Other notable losers are BHEL, Tata Power, Coal India and Sun Pharma.

On the gaining side, HDFC, Cipla, Infosys, Wipro and Bharti Airtel have risen between 1-2%.

Shares of Infosys are trading higher by 1.6% to Rs 2,229 on the BSE after Infosys BPO secured an IT services deal with Dutch insurance services firm a.S.R. for supporting back-office operations.

Shares of Cipla are trading higher by 2% to Rs 675 on the BSE on reports stating that the pharmaceutical major, Cipla and Pune-based unlisted Serum Institute will plan a marketing tie up under which Cipla will sell Serum's products in selected markets abroad.

Orange SA has explored various acquisitions in Africa, including assets owned by Bharti Airtel Ltd, as the French company seeks to bolster its business in the region, according to people.

Among other shares, PTC India have slumped over 9% to Rs 85 on the BSE after the electricity trading firm’s net profit for the third quarter this fiscal plunged to Rs 7 crore due to one-time provision of Rs 33 crore as compared to  Rs 91 crore profit the year-ago period.

Chennai-based Indian Overseas Bank (IOB) has slipped by nearly 3% at Rs 49 on the NSE after reporting a net loss for a consecutive quarter reflecting the stress on state-run lenders’ finances due to sustained deterioration in health of assets.