Sensex slips 150 points, Infosys gains 4%

Bear + A Falling Stock Chart

The BSE Sensex fell for a second straight session on Monday to its lowest close in nearly a month as Sun Pharmaceutical Industries dropped on reports of its talks to buy Sweden’s Meda AB, while Maruti Suzuki India slumped after sales declined 14.4 per cent in May.

Shares were also hit by an HSBC survey that showed factory output shrank in May for the first time in over four years, suggesting the economy remained frail at the start of the new fiscal year.

The weak PMI reading added to already rising concerns the central bank would hold off cutting interest rates this month due to inflationary pressures and a wide current account deficit.

Domestic shares also tracked weak global shares in the face of continued uncertainty over how much longer the current U.S. stimulus would continue and factory activity data that underscored the fragility of China’s economy.

“Correction may continue in the short term as economic indicators weaken but sharp dips should be utilised to buy,” said G. Chokkalingam, executive director and chief investment officer of Centrum Wealth Management.

The benchmark BSE Sensex fell 0.76 per cent, or 149.82 points, to 19,610.48, marking its lowest close since May 3.

The broader Nifty fell 0.78 per cent, or 46.65 points, to 5,939.30, marking its lowest close since April 30 and ending below the key level of 6,000 for the second consecutive session.

The rupee’s moves are being closely watched as any further weakness is likely to trigger concerns about foreign fund inflows and raise issues about funding the current account deficit, traders said.

Sun Pharma fell 2.5 per cent on media reports the company is in talks to buy Sweden’s Meda AB for $5 billion to $6 billion to boost its generics business in developed markets.

Maruti Suzuki India fell 2.3 per cent after the automaker’s sales declined 14.4 per cent in May compared with a year earlier.

Bajaj Auto dropped 3.4 per cent after it said in a statement that its motorcycle sales declined 5 per cent in May.

Hero MotoCorp fell 3.8 per cent after it said two-wheeler sales in May remained almost flat at 557,890 units.

Suzlon Energy fell about 10 per cent to a record low, a fifth consecutive session drop, after the wind turbine maker said its January-March net loss widened from a year earlier.

However, among stocks that gained, Infosys rose 4.3 per cent on bets the return of founder and former chairman N.R. Narayana Murthy as executive chairman would improve the company’s outlook.

CRISIL ended 20 percent higher after McGraw Hill Financial Inc, which owns Standard & Poor’s rating agency, said it would make a voluntary open offer to raise its stake in the company to 75 per cent in a deal worth about $340 million.

Source : NDTV Profit

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