Profit-taking by traders after two sessions of gains amid weak global cues dragged the Indian market modestly lower on Wednesday.
With Greek debt issues still weighing on investor minds and speculation mounting over further interest rate hikes by Beijing, a further drop in crude prices to near $98 a barrel failed to lift sentiment. Expectations that OPEC will raise crude output at a meeting later today kept a lid on crude prices.
After showing some resilience early in the session, the benchmark BSE Sensex lost ground during the last two hours of trading to end down 101 points or 0.55 percent at 18,394, with 19 of its components declining. Likewise, the broader Nifty index struggled for direction in the morning before losing ground and ending down 29 points or 0.53 percent at 5,527.
Most Asian stock markets fell on Wednesday, European stocks drifted lower for a sixth consecutive session, dragged down by miners, and the Dow futures pointed to a weaker open on Wall Street, following cautious comments from Federal Reserve chairman Ben Bernanke on the U.S. economic recovery.
Bernanke admitted Tuesday that economic growth has been below its potential this year but gave no hints regarding further stimulus plans, dashing investor hopes that that there could be a third round of quantitative easing. "Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established," he said.
Adding to the negative tone, the World Bank today lowered its global growth forecast for 2011 to 3.2 percent from 3.3 percent, citing the political unrest in the North Africa and Middle East and the natural disaster in Japan. Credit ratings agency Moody's, meanwhile, warned that the U.K.'s triple-A credit rating could be at risk.
Back home, healthcare, banking, auto, metal and oil/gas stocks bore the brunt of the selling, while FMCG stocks rose on defensive buying. Consumer goods also witnessed stock-specific buying.
Auto stocks fell ahead of a meeting of a government panel tomorrow that will decide on the fuel price hike. Hero Honda Motors tumbled 3.6 percent and Bajaj Auto lost 1.5 percent. Car maker Maruti Suzuki fell 1.2 percent, as investors kept a close eye on an ongoing strike at its Manesar plant.
In the IT sector, Infosys shed 0.7 percent after it bought the software solutions business of New Zealand's Telecom Corporation for an undisclosed sum. Rival TCS and Wipro closed in positive territory with modest gains.
Rate-sensitive banking stocks declined ahead of RBI's monetary policy review meeting due next week. ICICI Bank lost 0.6 percent and HDFC Bank fell a percent. SBI shed a percent after it announced plans to raise 200 billion rupees by December via a rights issue. Axis Bank lost 1.3 percent on going ex-dividend.
Among the other prominent decliners, aluminum maker Hindalco fell 2 percent, mortgage lender HDFC eased 1.6 percent, copper producer Sterlite shed a percent and energy giant Reliance Industries ended down 0.9 percent.
Realtor DB Realty climbed nearly 7 percent on posting solid FY11 earnings. Other property stocks such as DLF, Ackruti City and Parsvnath Developers closed up between 0.3 percent and 3 percent.
Reliance Communication rose 2.5 percent amid media reports that U.S.-based private equity firms TPG Capital and Carlyle Group are in talks to buy a stake in the company's mobile-phone towers unit, Reliance Infratel.
FMCG player Hindustan Unilever advanced 1.7 percent and ITC added 0.8 percent on defensive buying. Power producer NTPC gained a percent on an ET report that it is among 12 other power firms that will receive coal for their newly commissioned power projects with combined capacity of 12,200 megawatts. ONGC lost 2.3 percent while GAIL rose 1.9 percent amid reports that they are in talks to buy a part of Exxon Mobil Corp.'s stake in Kazakhstan's Kashagan oil field.
Tata Global Beverages soared over 4 percent and Steel Strips Wheels rose 1.7 percent on stake sale reports. Unity Infraprojects added nearly 2 percent on securing a Rs.100-crore order from a civic body of Madhya Pradesh.
Thinksoft Global Services jumped 9 percent after the software testing firm said it plans to buy companies within the range of Rs.15-30 crore during the current financial year.
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May 08, 2026 15:50 ET Manufacturing and services sector survey results and labor market data from main economies were the highlight on the economics news front this week. Factory orders and jobs report dominated the news flow in the U.S. Similarly, industrial production data from German garnered attention in Europe. In Asia, purchasing managers’ survey results from China and the central bank decision from Australia were in focus.