Sensex end lower; DLF slumps to record low

By Indulal PM

MUMBAI (Reuters) - The BSE Sensex and Nifty edged down on Tuesday as DLF plunged after market regulator Securities and Exchange Board of India (SEBI) banned it from tapping capital markets, although broader losses were capped as Reliance Industries gained after better-than-expected earnings and lenders rose on easing inflation.

Sentiment was weak across the globe as deepening worries about the health of the global economy dragged Wall Street, Europe and Japan lower.

Adding to the concerns, foreign institutional investors, who have invested $13.7 billion this year, turned net sellers. Overseas investors sold Indian shares worth $110 million on Monday, their fourth session of selling in five.

"Markets should trade range-bound in the near-term. However, an expectation of growth picking up in India will lead to higher valuations," said Dipen Shah, head of private client group research at Kotak Securities.

"Export-oriented companies should be able to report better numbers, while domestic infrastructure companies will still see some tough time."

The BSE Sensex fell 0.13 percent to 26,349.33, while the broader Nifty ended 0.26 percent lower at 7,864.

Technology stocks led the fall as investors took profits after a two-day rally. Infosys Ltd , which gained 8.1 percent in the last two sessions after reporting its quarterly earnings on Friday, fell 0.6 percent, while Tata Consultancy Services closed down 0.6 percent.

DLF shares plunged as much as 30 percent to their all-time low after the market regulator barred the country's largest listed property developer from tapping capital markets for three years.

Sesa Sterlite closed down 0.12 percent after the Supreme Court reiterated a prior ruling that all iron ore mined in Goa before 2007 belonged to the western state. The stock fell as much as 12.4 percent during the day.

However, Reliance Industries gained 0.4 percent after the company's July-September earnings beat estimates.

Interest rate-sensitive stocks rose with State Bank of India gaining 1.5 percent after government data showed retail inflation eased in September.

Retail inflation eased to a near five-year low last month, helped by a moderation in food and fuel prices, but the risk of price shocks is expected to prevent the central bank from cutting interest rates soon.

Bajaj Auto shares ended 2.7 percent higher after Bank of America-Merrill Lynch upgraded the stock to "buy" from "underperform" ahead of the company's September-quarter earnings.

(Editing by Subhranshu Sahu)