BSE Sensex edges lower; Hero MotoCorp falls

By Abhishek Vishnoi

MUMBAI (Reuters) - The BSE Sensex edged lower on Tuesday, backing away slightly from near three-year highs hit in the previous session, as Hero MotoCorp fell a day ahead of its quarterly earnings, while caution prevailed ahead of a key U.S. monthly jobs report.

The U.S. non-farm payrolls report later in the day may help calibrate bets on when the Federal Reserve would start the expected tapering of its monetary stimulus.

At home, traders are also growing cautious ahead of earnings from major companies such as ICICI Bank and ITC Ltd , while the Reserve Bank of India is due to hold its policy review on October 29.

Still, sentiment remains buoyed as foreign investors continue to purchase Indian shares, remaining net buyers for a twelfth consecutive session on Monday for a combined total of 103.1 billion rupees, according to regulatory and exchange data show.

"Earnings from better business except pharmaceuticals are out, so expect some short-term correction given recent gains" said Paras Adenwala, managing director and principal portfolio manager at Capital Portfolio Advisors.

The benchmark BSE Sensex edged down 0.14 percent, or 28.92 points, to end at 20,864.97 after hitting its highest level since November 2010 on Monday.

The broader Nifty drifted down 0.03 percent, or 2.15 points, to end at 6,202.80.

Hero MotoCorp Ltd fell 1.6 percent ahead of its July-September earnings due on Wednesday.

Hero may miss the consensus operating profit forecast for the July-September quarter, according to Thomson Reuters StarMine data.

Reliance Industries Ltd fell 1 percent on profit-taking after rising more than 5 percent in the last three consecutive sessions until Monday.

Wockhardt Ltd fell 4 percent after Britain's drug regulator revoked the quality compliance certificate for one of its factory in India, the drugmaker said on Tuesday, the third of its plants to be hit by export restrictions this year.

Karnataka Bank Ltd fell 5 percent after its September quarter profit plunged 75 percent to 289.5 million rupees.

However among stocks that gained, Yes Bank Ltd rose 3.7 percent after its net profit rose 21.2 percent to 3.71 billion rupees, beating analysts' estimates.

Indian sugar companies rallied after global raw sugar futures spiked to a one-year high after a fire engulfed four warehouses in Brazil's Santos port, jeopardizing a fifth of monthly exports from the top producer's main terminal.

Shree Renuka Sugars Ltd surged 10.3 percent, Bajaj Hindusthan Ltd gained 4.2 percent, while Balrampur Chini Mills Ltd rose 1.5 percent.

Wipro Ltd rose 1.7 percent.

(Editing by Anand Basu)