Markets slump on S&P downgrade

Software, banks lead fall

Benchmark share indices fell nearly 1% following a Standard & Poor report which downgraded India to 'negative' from 'stable'.

The report said that investment and economic growth slowed, current account deficit widened and expects government to face headwinds in implementing policy measures.

The Sensex was down 146 points at 17,061 while the Nifty was down 49 points at 5,173.

 

The fall was led by selling pressure in banks, software shares and index heavyweight Reliance Industries.

Among Sensex shares, ICICI Bank was among the top losers down 1.8% at Rs 832 and SBI down nearly 1%.

In the software segment, Wipro was down 7.6%, TCS slipped 1.6% after recent gains post fourth quarter earnings while Infosys was down 0.6%.

Among other Sensex shares, L&T was down 1.6%, ITC and Reliance Industries slipped nearly 0.5% each.

Market breadth on the BSE was weak with 1,538 declines and 860 advances.

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(Updated at 11:12 hrs)

Markets continued to move sideways in late morning trades a day ahead of the futures & options expiry on Thursday. Mixed cues from the global bourses and Wipro's results has taken the Sensex to 17,205 - down two points. Nifty is unchanged at 5,221.

Asian shares rose on Wednesday as firm US corporate earnings, signs of an improving US housing market, and healthy demand for euro zone sovereign debt stoked risk appetite, while focus shifted to the Federal Reserve's meeting. Nikkei has gained 1% at 9,559. Shanghai Composite has added half a per cent in trades.

IT shares continued to be in red. BSE IT index has dropped 1.7% to 5,468. Wipro has slumped 7.3% to Rs 410 following its quarterly numbers. The software services exporter, reported a 1.7% rise in quarterly net profit, roughly in line with analysts expectations, as its cost-conscious customers bumped up demand.

Meanwhile, the BSE Auto, FMCG and metal indices have advanced in trades with the Auto index gaining 0.7% to 10,656.

TCS and Infosys from the IT space have followed Wipro and shed over 1% each. Gail has slipped 3% to Rs 338.

Telecom stocks remained in focus today as the regulator has proposed a 10-fold increase in the reserve price for spectrum over what operators had paid in 2008. Bharti Airtel has added 2.5% to Rs 314.

Metal shares are shining. Sterlite has gained 1.3% at Rs 107, followed by Jindal Steel, Tata Steel and Hindalco.

From the auto space, Hero MotoCorp has moved up 1.6% to Rs 2,232. Bajaj Auto has added 1.5% to Rs 1,672 and Maruti Suzuki is at Rs 1,383 - up 1.3%.

Sesa Goa has surged 1.5% at Rs 186 in spite of the 20.5% decline in its consolidated net profit at Rs 1,162 crore for the fourth quarter ended March 2012.

JM Financial group has increased its stake in IVRCL to 5.04% by acquisition of an additional 1.2 million shares. Shares of JM Financial has jumped 1.8% to Rs 14.05. IVRCL is also up 3.5% at Rs 62.95.

BSE market breadth is positive. Out of 2,267 shares traded, 1,223 shares have advanced while 938 shares have decined.