BSE Sensex edges lower as mobile carriers slump

By Abhishek Vishnoi

MUMBAI (Reuters) - The BSE Sensex ended marginally lower on Thursday, retracing from its highest levels in five weeks, as mobile carriers such as Idea Cellular slumped on possible high bidding prices at a spectrum auction next month with eight companies applying.

Consolidation came after shares rose in three of four sessions as of Wednesday, marking a 2.8 percent gain for the Sensex on rising bets the RBI would keep interest rates unchanged at its January 28 meet.

The bets of a status quo on rates got a boost after data on Wednesday showed headline inflation fell to a five-month low. The RBI governor kept rates unchanged in his last review after two consecutive hikes.

"Indian shares would continue to edge higher till the RBI policy. Also, it's better that the environment remains positive in markets as the government plans to sell stakes in various companies," said G Chokkalingam, founder of research and fund advisory company Equinomics.

Traders say an optimistic start to the December-quarter earnings season by Infosys Ltd and HCL Technologies is expected to be strengthened by Tata Consultancy Services , which reports later in the day. Reliance Industries' earnings on Friday would keep the sentiment positive.

The Sensex fell 0.11 percent, or 24.31 points, to end at 21,265.18, after earlier marking its highest intraday level since December 9.

The Nifty lost 0.03 percent, or 2 points, to end at 6,318.90, but still managed to close above the psychologically important 6,300 level.

Mobile carriers slumped on concerns over possible high bidding prices at a spectrum auction next month after eight companies applied to bid, signalling much stronger competition than expected.

Idea Cellular slumped 7.2 percent, marking its biggest single-day percentage fall since May 2010, while Bharti Airtel fell 4.8 percent, the most since September 2013.

Reliance Communications dropped 4.2 percent, just marginally away from marking its highest intraday level since August 2013.

LIC Housing Finance fell 1 percent after its December-quarter net profit rose by 38.2 percent to 3.27 billion rupees, falling short of some analysts' expectations.

TCS fell 0.1 percent ahead of its October-December results later in the day.

However, HCL Technologies Ltd rose 4.5 percent after earlier rising to a record high of 1,398 rupees after the company's December-quarter consolidated net profit rose more than expected.

Bajaj Auto rose 0.7 percent after the company reported a better-than-expected 10.5 percent increase in quarterly net profit, helped by foreign exchange gains and as higher revenues from exports helped offset weak demand for its vehicles.

(Editing by Prateek Chatterjee)