 "Sensex marks biggest drop in 3 weeks, ends below 21000")
The benchmark Sensex retreated forthe third day in a row from an all-time high, dropping 246points to close below the 21,000 level today ahead ofinflation and industrial production data that may have abearing on the RBI’s policy next week.
Sentiment was also weighed down by weak global trends onincreasing expectations the US Federal Reserve would soonstart tapering its monetary stimulus programme.It was the biggest drop in three weeks for the index,which was dragged lower by Tata Motors, ICICI Bank, ITC andReliance Industries.
Auto and bank stocks led 11 of the 12 BSE sectoralindices down, with the power index the sole gainer.The 30-share S&P BSE Sensex resumed lower, in line with feeble Asian cues on the back of a sharp fall on Wall Streetyesterday, and moved in a narrow range. Fag-end selling pulledthe index further down and it ended at 20,925.61, a fall of245.80 points or 1.16 percent.
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It was the biggest drop since November 21. The index haslost 400 points in three sessions.The 50-share CNX Nifty on the National Stock Exchange
slumped 70.85 points, or 1.12 per cent, to 6,237.05. The SX40on the MCX Stock Exchange fell 136.94 points to 12,432.57.
“Caution is seen in the market ahead of inflation and IIPnumbers and also due to revived concerns over US taperingprogramme,” said Rakesh Goyal, Senior Vice President atBonanza Portfolio Ltd. “Economic concerns, profit booking andglobal cues are primary reasons for this fall.”
The Reserve Bank’s Mid-Quarter Review of Monetary Policyis scheduled on December 18. The RBI yesterday said it willfocus on controlling inflation and improving liquidity.
Tata Motors, the country’s largest commercial vehicleproducer, fell 4.55 per cent. Reports said its British luxurycar unit Jaguar Land Rover increased its investment guidancefor the year ending March 2015, which may increase debt andput pressure on the company’s free cash flow.
Asian shares closed lower on expectations the FederalReserve would unwind its stimulus following the provisionalbudget deal in Washington.
PTI