Sensex Logs Biggest Drop in 4 Months; Infosys Tanks 8 Pc

Thursday, May 29, 2014
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MUMBAI: The benchmark Sensex plunged 322 points, logging its biggest single-day drop in four months, weighed down by a sharp 8 percent sell-off in Infosys shares after a key executive quit, amid expiry of monthly equity derivative contracts. The Sensex resumed lower at 24,523.13 and continued to lose momentum to touch an intra-day low of 24,206.50. It settled at 24,234.15, down 321.94 points or 1.31 per cent — its biggest fall since the 426.11-point crash on January 27.

This closing level is Sensex’s lowest since 24,298.02 on May 21. It had ended higher by 6.58 points. The 50-share NSE index Nifty dipped below 7,300 mark by falling 94.00 points, or 1.28 percent, to close at 7,235.65 after shuttling between 7,325.40 and 7,224.40 intra-day. It was bad session for IT stocks led by Infosys. The Bangalore-headquartered giant ended 7.81 percent lower to end below the crucial Rs.3,000 mark for the first time since September 2013 after board member and President B G Srinivas, who was considered among the top contenders for the first non-founder CEO post, resigned from the company.

Wipro fell by 2.63 pe cent and HCL Tech, which is not a Sensex entity, slid 2.5 percent. However, TCS rose. Besides, expiry of May month series in the derivative contracts and persistent foreign capital outflows coupled with mixed global cues also affected the market sentiment, pulling down the benchmark indices. Tepid earnings from some bluechips also dashed hopes, say traders. There was also continued profit-booking in recent outperformers such as power, oil and gas, capital goods, banking, PSUs, realty and consumer durable stocks, they added.

Out of the 30-share Sensex, 22 stocks closed with losses led by Infosys, the third most influential on the barometer. Oil refinery major Reliance Industries fell 1.42 percent after CAG pulled up the firm for charging a rate in excess of the government approved price for its KG-D6 gas field. Sectorally, the BSE IT sector index suffered the most by falling 3.44 percent, followed by Tech index (2.92 percent), Oil and gas index (1.64 percent). Overall, 11 of 12 indices fell while BSE Healthcare index rose.

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Source: PTI
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