Sensex ends lower; oil explorers plunge
The BSE Sensex ended lower on Thursday with sharp falls in oil explorers such as Reliance Industries and Oil and Natural Gas Corp. after the government deferred a decision to hike prices of locally produced gas, while the expiry of monthly derivatives contracts also weighed on sentiment.business Updated: Jun 26, 2014 16:53 IST
The BSE Sensex ended lower on Thursday with sharp falls in oil explorers such as Reliance Industries and Oil and Natural Gas Corp. after the government deferred a decision to hike prices of locally produced gas, while the expiry of monthly derivatives contracts also weighed on sentiment.
India on Wednesday deferred a decision to raise prices of locally produced gas for the next three months, saying the matter requires more discussion, which some investors took as a first disappointment from the newly-elected Modi government.
However, capital goods and auto stocks gained after the government extended excise duty concessions for automobiles, consumer and capital goods by six months to Dec. 31.
Investors are now awaiting the budget on July 10 for further clarity on the government's policies.
The benchmark index will keep setting new highs in the coming year, after a small correction in the next few months, a Reuters poll found on Thursday.
"Market is likely to touch a new high in July in response to a growth-oriented budget and decent June quarter numbers from majority of the companies," said Vijay Kedia, managing director at Kedia Securities Pvt Ltd.
The benchmark ended 0.99% lower at 25,062.67 points, while the broader Nifty closed 1% lower at 7,493.20 points.
Oil and gas stocks led the fall with the BSE oil and gas index down 3.88% after the government decision to defer a gas price hike.
Shares in ONGC fell 5.84% to 411.35 rupees, while Reliance Industries plunged 3.72%. Oil India Ltd closed down 2.8%, while Cairn India Ltd ended 1.35% lower.
However, the losses were limited on the back of gains in capital goods and auto stocks such as Larsen and Toubro as duty concessions for automobiles, consumer and capital goods sectors lifted investor sentiment.
L&T gained 1.42% while Bharat Heavy Electricals Ltd closed 0.54% higher.
Among other stocks, ITC Ltd gained 0.06% after Morgan Stanley upgraded the stock to "overweight" and raised its price target to 400 rupees from 360 rupees.
Monsanto India closed 3.86% higher after earlier hitting a record high at 2,414 rupees after parent Monsanto Co beat quarterly forecasts, improved its near-term outlook and said it planned to double earnings over the next five years.