BSE Sensex down 0.4 pct; banks lead decline

MUMBAI (Reuters) - The BSE Sensex fell on Friday morning, led by losses in banks and weighed down by falls in Asian markets as investors shifted from riskier assets on concerns over the strength of the world economy.

Top lender State Bank of India down 0.9 percent and second-ranked ICICI Bank down 1.5 percent, after a finance ministry official said a bill to reform the insurance sector was unlikely to be cleared during the parliament's winter session.

"There were expectations built up that the insurance reforms will be a priority in this parliament session. Now, that it seems unlikely, SBI and ICICI are being knocked off," said D. D. Sharma, senior vice-president at Anand Rathi Securities.

"Besides, banks have run up a lot in last few months. So, when broader market falls, the stocks that outperformed are going to be hit the most," said Sharma.

The banking sector index is up 83 percent so far in the year, outperforming the main index which has risen more than 73 percent.

At 11:22 a.m. (0552 GMT), the 30-share BSE Index was down 0.43 percent at 16,713.75, with 24 components declining.

Top software services firm Tata Consultancy was down nearly 1 percent, while rivals Infosys and Wipro shed 0.6 percent and 1.8 percent respectively.

"Just like banks, IT too is under pressure as the stocks had performed exceedingly well in recent times, added Sharma.

The sector index has more than doubled so far in the year.