* BSE index falls 0.94 pct; NSE index down 0.96 pct
* Interest-rate sensitive stocks fall on profit-taking
* Shares tracking weak global cues, sell-off in govt bonds
By Indulal PM
MUMBAI, Aug 6 Indian shares fell more than 1
percent on Wednesday, snapping two days of gains, as lenders
such as State Bank of India and ICICI Bank slumped on worries
that a sell-off in government bonds would hit the value of their
A slump in global shares also dented sentiment after Wall
Street fell overnight and on reports of a build-up of Russian
troops near the border with Ukraine.
The falls mark a cautious start to the month in Indian
shares after a record-setting July. The NSE index is
down 0.6 percent so far this month, given concerns that weaker
global markets will lead to reduced buying by foreign investors.
Overseas investors, who bought Indian shares worth $8.68
million on Tuesday, have sold shares worth $363.48 million so
far this month. Foreign investors have bought $11.79 billion so
far this year.
"Markets are likely to be choppy for the time being.
Earnings are coming to an end. There is a lack of fresh
triggers. It would be more of news-driven kind of movement for
the time being," said Daljeet S Kohli, head of research at
"However, the broader sentiment is still positive."
The benchmark BSE index ended 0.94 percent lower at
25,665.27 points, while the broader NSE index ended 0.96
percent lower at 7,672.05 points.
Banking stocks led the decline after bonds tumbled on
Tuesday, raising worries about their debt holdings.
The Reserve Bank of India had earlier on Tuesday cut the
banks' minimum bond holding requirements, known as the statutory
liquidity ratio (SLR), as well as the debt that must be
held-to-maturity (HTM) by lenders.
The existing benchmark 10-year bond yield
surged 10 basis points to 8.83 percent, its biggest single-day
rise in four months, on Tuesday and an additional 2 bps on
State Bank of India fell 1.93 percent, after
gaining 0.5 percent in the previous session, while ICICI Bank
Ltd ended down 2.7 percent.
Real-estate stocks were also hit by profit-taking. DLF Ltd
fell 1.4 percent after gaining 2.2 percent in the
previous session, while Indiabulls Real Estate closed
down 5.6 percent.
Among other blue-chips, Tata Motors ended 2.02
percent lower on profit-taking after gaining 2.3 percent on
Hindalco Industries closed 1.99 percent lower,
while Oil and Natural Gas Corp. fell 2.1 percent.
However, Infosys Ltd gained 1.8 percent, adding to
its 1.4 percent gain in the previous session, after former
officers of the IT outsourcer wrote a letter calling for a
112-billion-rupee (1.82 billion US dollar) buyback.
For additional stocks on the move double click
FACTORS TO WATCH
* Euro hurt by German industrial data, Ukraine worries
* Oil rebounds towards $105 from 9-month closing low
* Russia worries, weak German data weigh on Europe
* Foreign institutional investor flows
* For closing rates of Indian ADRs
ASIA-PACIFIC STOCK MARKETS:
Pan-Asia........ Japan....... S.Korea...
S.E. Asia....... Hong Kong... Taiwan....
Australia/NZ.... India....... China.....
Wall Street .... Gold ....... Currency..
Eurostocks..... Oil ........ JP bonds...
ADR Report ..... LME metals. US bonds..
Stocks News US.. Stocks News Europe
DIARIES & DATA:
Indian Data Watch Asia earnings diary
U.S. earnings diary European diary
Indian diary Wall Street Week Ahead
Eurostocks Week Ahead
For top Asian company news, double click on:
U.S. company news European company news
Forex news Global Economy news
Technology news Telecoms news
Media news Banking news
Politics/General Asia Macro data
(1 US dollar = 61.4050 Indian rupees)
(Editing by Sunil Nair)