Sensex falls 97 pts on Wipro results, RIL stock downgrade
The BSE Sensex today fell for the third straight day, losing about 97 points to close at over 19,448, on sustained selling following lower-than-expected earnings and sales forecast by IT major Wipro.business Updated: Apr 27, 2011 17:06 IST
The BSE Sensex today fell for the third straight day, losing about 97 points to close at over 19,448, on sustained selling following lower-than-expected earnings and sales forecast by IT major Wipro.
It is another heavyweight company -- after Reliance Industries Ltd (RIL) and Infosys -- to have posted fourth quarter earnings that have failed to enthuse investors.
Besides, brokers said reports that Goldman Sachs cut RIL stock to "neutral" from "buy" pulled down its scrip, which has the heaviest weightage in the 30-share Sensex.
Opening higher, the Bombay Stock Exchange index Sensex finally fell 96.66 points to 19,448.69, after touching the day's low of 19,412.79. In last two-trading sessions it had lost 57 points. Similarly, the broad-based National Stock Exchange index Nifty fell 34.50 points to 5,833.90.
Wipro fell 2.86 per cent to Rs 450.75. Its sales in the three months ended March were 1.4 billion dollar, less than the market expectations. The most heaviest on the Sensex, RIL slid 1.56 per cent to Rs 985.15, extending this year’s decline to 6.8 per cent.
Brokers said Q4 earnings growth have disappointed investors so far. Besides, a weak trend in the Asian markets dampened their sentiment. The Sensex has fallen 5.2 per cent this year on concerns that high inflation will lead to high interest rates, raising borrowing costs for corporates and hitting their margins.
The Reserve Bank of India has raised interest rates eight times since early 2010 to curb inflation. It is slated to meet again on May 3 to review the monetary policy. The realty sector index suffered the most by losing 1.55 per cent to 2,309.60 followed by capital goods index by 1.20 per cent to 13,545.65.