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Stocks

Indian shares drop in line with Asia ahead of GDP data

Sensex edges lower on month, Nifty slides 1.1%

MUMBAI (NewsRise) -- Indian shares fell on Thursday after an overnight selloff in U.S. technology stocks rattled Asian markets, and as investors braced for September-quarter gross domestic product data at home.

Caution stemming from the expiry of monthly derivative contracts also caused volatility on Thursday.

The BSE Sensex declined 1.4%, or 453.41 points, to end at 33,149.35 on Thursday, while the Nifty 50 Index fell 1.3%, or 134.75 points, to 10,226.55. For November, the Sensex edged 0.2% lower. Nifty ended down 1.1% for the month.

Financials were among the major losers on Thursday, with State Bank of India and private lenders ICICI Bank, Axis Bank and Kotak Mahindra Bank shedding more than 1% each. Mortgage lending heavyweight Housing Development Finance Corp. lost 1.5%. Conglomerate Reliance Industries dropped 2.4% to 922.60 rupees after HSBC reportedly cut its price target to 1,029 rupees from 1,035 rupees.

In November, Lupin led losses with a 20.3% decline, its biggest monthly loss since May 2002 after reporting a 31% decline in September-quarter profit, and on warnings from the U.S. Food and Drug Administration about two of its facilities. Infosys rose 5.8% to pace gains, while State Bank of India added 4.8% in November.

"Lower Asian markets and the derivatives expiry weighed on markets today," said Hemen Kapadia, research, KR Choksey. "Reliance has walked into a correction. Elections could be a trigger for markets to take the course of correction, but I don't see major downsides."

Kapadia said if the Nifty50 rises to the 10,500-level next month, it might visit 10,700 points before the end of the year.

The Nikkei Asia300 Index fell 1.5% on Thursday after the technology-heavy Nasdaq Composite suffered its biggest single-day loss in three months overnight.

At home, sentiment was also dented after government data showed the nation's fiscal deficit in the first seven months of the current financial year that started Apr. 1 totalled 5.25 trillion rupees, widening from 4.24 trillion rupees in the comparable year-earlier period. Investors await September-quarter GDP data, due later Thursday.

On Thursday, 29 of the 30 Sensex constituents ended lower, while overall declining issues outnumbered advancing issues 1,426 to 1,249 and 152 remained unchanged.

Jewellery retailer Tribhovandas Bhimji Zaveri slumped 10.7% after reporting a 90% drop in September quarter profit and a 27% decline in revenue.

Infosys ended fell 0.9%. The software exporter's 130 billion-rupee share buyback opened on Thursday and will end on December 14.

Automakers Tata Motors and Mahindra & Mahindra shed at least 1.6% each.

Reliance Capital lost 2%. The Securities and Exchange Board of India has issued its final observation letter to the draft red herring prospectus filed by Reliance General Insurance Company for an initial public offering, Reliance Capital said. The IPO comprises of a fresh issue of up to 16.8 million equity shares by the company and an offer for sale by Reliance Capital of up to 50.3 million shares.

Automotive steel wheel rim maker Steel Strips Wheels gained 3.7% after it won an export order for 6,000 truck wheels for the European trailer market.

--Nivedita Naidu

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