Indian shares finish little changed in lacklustre trade

Monday, 31 March 2003, 08:00 Hrs
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MUMBAI: India's blue-chip share market index finished little changed Friday from its previous session's trade, as the uncertainty about the length of the Iraq war continued to weigh heavily on investors' sentiment.

Mirroring the bearish sentiment, the market barometer 30-share Bombay Stock Exchange sensitive index or Sensex closed at 3,115.44, a loss of 1.35 points or 0.04 percent from its previous session's close.

Dealers said that the market opened subdued and kept moving within a close range in a highly lacklustre trade, as investors preferred to stay away from the trading ring on fears of a prolonged US-Iraq war.

Anticipation of a quick war propelled India's blue-chip shares sharply higher last week, but caution is creeping back into the trading ring as the war to oust Iraqi President Saddam Hussein progresses.

"Investors are waiting on the sidelines of the trading ring and analysing every bit of news to get a clue on how long the war will continue," said Neeraj Deewan, a share market analyst with Quantum Securities.

"Stock markets hate uncertainty and the ambiguity about the war length and its likely impact on the Indian economy is weighing heavily on investors' mind at the moment," he added.

Experts say while India may manage to absorb the impact of a short war with little damage to oil supply, a long and messy military campaign would put roadblocks in front of the feeble Indian economic rebound.

Iraq said Friday that its troops had repulsed two U.S.-British attacks in Najaf and Muthanna in the country's south and forced them to retreat back into the desert.

Fresh U.S. troops, on the other hand, were expected to be deployed in the Persian Gulf as the overnight bombing of the Iraqi capital Baghdad turned out to be one of the most intense yet

News reports said some 30,000 soldiers of the 4th Infantry Division and other units from Texas were to be deployed to the region in the next few days. Another 100,000 ground troops might be located in the next month.

While old economy stocks slipped on growing fears that rising crude oil prices could hit the bottom lines of companies, tech stocks weakened after a steady opening.

In the old economy sector, Hero Honda Motor, India's largest motorcycle maker, lost 3.3 percent to touch 196.40 on sustained selling pressure.

The stock has been losing ground steadily in recent trading sessions on reports that the motorcycle market, which has grown rapidly in the recent past, is expected to slow down this month.

Tata Steel, the largest private sector steel maker, fell one percent to 133.80 following reports that the Indian steel producers are planning about 500-a-tonne cut in prices from April 1.

Consumer goods giant Hindustan Lever closed with a loss of 0.4 percent at 152.60 on fears that prolong Iraq war would dampen the company's sales in the next fiscal.

In the tech sector, HCL Technologies, a New Delhi-based software development and services major, lost two percent to touch 159.55 and Hyderabad-based Satyam Computer closed with a loss of 1.9 percent at 191.90.

Infosys Technologies, India's largest listed software exporter, ended 0.6 percent lower at 4,263.35 on selling pressure following an overnight fall in the U.S. stock markets.

Source: IANS
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