India shares lower for 4th day; tech stocks fall ahead of earnings

Mon Apr 8, 2013 5:02pm IST

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* BSE ends 0.07 pct down, NSE 0.19 pct lower
    * Tech shares fall ahead of Infosys earnings on Fri
    * Infra stocks gain on government push for stalled projects

    By Subhadip Sircar
    MUMBAI, April 8 (Reuters) - India's NSE index edged lower on
Monday to a near seven-month low as software services exporters
fell ahead of what is widely expected to be a lacklustre
earnings season, and as foreign funds continued to exit local
holdings. 
    The main index notched a fourth consecutive session of
falls, tracking a decline in Asian shares after disappointing
U.S. jobs data and rising geopolitical tension in the Korean
peninsula worried global investors. 
    The outlook for shares remains cautious as foreign
institutional investors - a critical part of markets - have now
sold $114.3 million worth of stocks in three successive sessions
to Friday, according to regulatory data. 
    However, some analysts said domestic indexes may be oversold
in the near term, raising the prospect of a bounce back.
    "We need to closely watch the fund flows. There may not be
much interest in Indian markets in 1-2 weeks also as fund
outflows set in delayed relative to other emerging markets, but
eventually fund flows will come in," said Rajesh Cheruvu, chief
investment officer for India private banking at RBS.
    "The market has broadly factored in muted earnings.
Valuations are pretty much attractive and we do not see much
downside from hereon," he said.
    The broader 50-share NSE index fell 0.19 percent, or
10.30 points, to close at 5,542.95, its lowest close since Sept.
13.   
    The BSE index declined 0.07 percent, or 12.45
points, to close at 18,437.78, to its lowest close since Nov.
20.
    Technology shares led the falls after the poor U.S. non-farm
payrolls data raised concerns about the recovery in the U.S.
economy, the biggest outsourcing market for the IT firms.
    Infosys Ltd fell 1.2 percent ahead of earnings on
Friday. Other technology shares like Wipro Ltd edged
down 1.3 percent, while Tata Consultancy Services Ltd 
was 1.2 percent lower.
    Indian lenders fell as investors remained cautious on the
prospect of future monetary easing on the high current account
deficit and retail inflation. 
    Jefferies initiated coverage on Indian banks noting
fundamentals for India's banking sector are unlikely to change
much given "tepid" loan and deposit growth, "range-bound" net
interest margins and "weak" asset quality. 
    With earnings likely to remain muted, investors bought
defensive stocks like consumer durables and pharmaceuticals.
    Hindustan Unilever Ltd rose 1.3 percent, while Sun
Pharmaceutical Industries Ltd gained 0.7 percent. Cipla
Ltd closed up 2.1 percent.
    Infrastructure stocks in oil and gas and power, as well as
infrastructure stocks gained as the government showed intent to
clear bottlenecks in the sector.
    Finance Minister P. Chidambaram met bankers in Mumbai on
Friday and identified 215 stalled infrastructure projects for
speedy implementation.
    Reliance Industries Ltd rose 1.2 percent, while
Reliance Infrastructure Ltd gained 3.3 percent.
    Telecommunications shares rose after the country's top court
allowed companies to continue 3G pacts until its next hearing on
April 11. Bharti Airtel Ltd closed up 3.8 percent,
while Idea Cellular Ltd ended 3.3 percent higher.
    Bharat Heavy Electricals Ltd rose 2.6 percent
after the company reported better-than-expected provisional
earnings. 
        
    FACTORS TO WATCH                                            
 * Yen slides further as BOJ kicks off aggressive stimulus
  
* Oil rises above $105, rebounding from 8-month low        
  
* Yen falls on BoJ bond buys, while shares recover   
* Foreign institutional investor flows          
* For closing rates of Indian ADRs                       
                          
   ASIA-PACIFIC STOCK MARKETS:                                  
Pan-Asia........ Japan.......   S.Korea... 
S.E. Asia.......        Hong Kong...  Taiwan.... 
Australia/NZ....        India.......  China..... 
                           
   OTHER MARKETS:                                               
Wall Street ....         Gold ....... Currency.. 
Eurostocks.....         Oil ........  JP bonds... 
ADR Report .....       LME metals. US bonds.. 
Stocks News US.. Stocks News 
    
    DIARIES & DATA:                                             
 
Indian Data Watch   Asia earnings diary 
U.S. earnings diary     European diary       
Indian diary          Wall Street Week Ahead  
Eurostocks Week Ahead                                   
                            
   TOP NEWS:                                                    
   For top Asian company news, double click on:       
   U.S. company news  European company news  
   Forex news        Global Economy news  
   Technology news  Telecoms news        
   Media news       Banking news           
   Politics/General    Asia Macro data       

 (Additional reporting by Abhishek Vishnoi and Manoj Dharra;
Editing by Anand Basu)
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