Nifty falls most in 2-1/2 weeks; earnings fail to impress

By Abhishek Vishnoi

MUMBAI (Reuters) - The Nifty fell nearly 1 percent on Thursday, marking its biggest single-day fall in nearly 2-1/2 weeks, weighed down by foreign investors' sales after earnings at blue chips such as Maruti Suzuki Ltd failed to impress markets.

Foreign investors, who played a major part in the Nifty hitting a record high last week, sold cash shares worth $63.4 million on Wednesday, marking their first sales in 10 days.

The losses were exacerbated as European shares fell during late India trade after data showed annual inflation in the euro zone fell in July to its lowest since the height of the financial crisis in 2009, and by the expiry of domestic monthly derivative contracts at the end of the session.

Still, the losses on Thursday were seen by some analysts as profit-taking after a strong month. The NSE rose 1.4 percent in July to notch up its third consecutive monthly gain on confidence about Prime Minister Narendra Modi's government.

Foreign investors were strong buyers ending up with net purchases of 22.35 billion rupees for July.

"Regular profit-taking after a run-up is religion in the market. The uptrend is intact as upgrades on Indian shares continue on the new-found confidence in a Modi-led economic recovery," said Nirakar Pradhan, chief investment officer at Future Generali India Life Insurance.

The broader Nifty fell 0.9 percent, or 70.10 points, to end at 7,721.30, retreating from a record 7,840.95 points on July 25.

The benchmark Sensex lost 0.74 percent, or 192.45 points, to end at 25,894.97.

Maruti Suzuki fell 1.1 percent after company's April-June operating margin at 11.7 percent lagged some analysts estimates.

ICICI Bank fell 1.2 percent despite better-than-expected earnings. Dealers cite disappointment after net profit when adjusted for other income came actually below consensus.

Meanwhile, software stocks fell after rival HCL Technologies' April-June U.S. dollar revenue growth lagged some estimates.

HCL Technologies ended down 2.7 percent, Wipro lost 1.2 percent, Infosys fell 0.6 percent while Tata Consultancy Services ended down 0.2 percent.

Larsen & Toubro fell 1.4 percent, adding to its slump of 7.1 percent in the previous session after the company's earnings missed some analysts' estimates on Wednesday.

Among other decliners, Cadila Healthcare Ltd fell 4.5 percent after the drug maker said it was responding to certain observations from the U.S. Food and Drug Administration after conducting a "product specific" inspection of its Moraiya manufacturing plant.

However, IRB Infrastructure Developers Ltd jumped 7.8 percent after April-June toll revenue beat market estimates, traders said.

(Reporting by Abhishek Vishnoi; Editing by Sunil Nair)