Sensex hits 1-1/2-year low, stares at third day of losses

MUMBAI (Reuters) - India's stock markets reversed earlier gains to hit a one-and-a-half-year low on Wednesday and headed for their third straight session of losses on disappointment over corporate earnings, concerns about China, and profit-booking in broader markets.

Tata Consultancy Services shares fell more than 3 percent after third-quarter dollar revenue of the country's largest IT services exporter missed street estimates.

Sentiment was also soured as Chinese markets gave up earlier gains to end 2.4 percent lower, underscoring the fragility of investor sentiment following last week's rout.

"The market is in a bearish mode. Many frontline stocks have hit 52-week lows, expectations from earnings are low and investors are booking profits in mid-cap stocks," said Alex Mathews, head of research at Geojit BNP Paribas.

 

The broader Nifty fell as much as 1.1 percent to its lowest level since July 14, 2014, after rising 1 percent earlier in the session.

The BSE Sensex declined as much as 1.2 percent to its lowest level since June 2, 2014.

The Nifty and Sensex were trading down 0.4 percent and 0.6 percent, respectively at 1.35 p.m.

Mid-cap stocks fell the most with the S&P BSE Midcap down 2.34 percent and the Nifty Midcap 100 sub-index lower 2.8 percent.

Banking stocks continued to languish with nearly all lenders trading in the red.

Capital goods stocks such as Larsen & Toubro fell 3.8 percent and BHEL dropped 4.35 percent on disappointing factory data that came out late on Tuesday.

Meanwhile, shares of Infosys gained 1.5 percent on hopes that the valuation gap between the stock and larger rival TCS was closing.

(Reporting by Karen Rebelo in Mumbai; Editing by Subhranshu Sahu)