Mumbai: Infosys’ lower dollar revenue forecast for the current fiscal threw markets off-track today, triggering a bout of profit taking, which saw the benchmark BSE Sensex close 175 points lower at 26,904.11.
The market was pulled down by IT shares, where the fall was across the board.
India’s second-largest software exporter, Infosys’ gave up all its early gains and ended 3.88% down after a downward revision of dollar revenue guidance for 2015-16 despite a 9.8% rise in September quarter net profit at Rs 3,398 crore.
The reaction was sharp as IT index plunged 2.02% while technology took a hit of nearly 1.85%.
Investors stayed cautious as they waited for a string of economic indicators such as September CPI inflation and August industrial production, which are due for release after market hours on Monday.
A weaker rupee, at 64.75, also cast its shadow on market sentiment.
Other factors that kept participants anxious were the Bihar election, which started on Monday, and the lingering black-money issue.
The 30-share index barometer jumped 225 points in the beginning, but headed into the red zone soon after Infosys results and settled 175.40 points down, or 0.65%, at 26,904.11.
The 50-issue Nifty too ended lower by 46.10 points, or 0.56%, at 8,143.60 after shuttling between 8,244.50 and 8,128.20.
“The domestic market is affected by headwinds from the mixed start to the Q2 results (Infosys), Bihar election and black money issue. Additionally, today market is awaiting the economic data like CPI and IIP,” said Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services.
Lupin, Cipla, Sun Pharma, TCS and Dr Reddy’s too lost big time.
The stock of Bank of Baroda felt the heat as it ended 3.02% down after CBI carried out searches three of its locations in New Delhi for an alleged forex violation of Rs 6,000 crore.
However, metal stocks were in a sweet spot, which soared for the second day after Glencore said it will cut zinc output by a third, sparking a short-covering rally.
Vedanta gained 7% while Hindalco rose 5.98%. The broader markets, however, saw some buying activity. The BSE mid-cap advanced 0.15% and small-cap ended higher by 0.01%.
Major indices in Asia ended higher and Europe was trading lower in its early session.