Markets slipped in trades as political uncertainty continued to dampen investor sentiments. Bourses ignored positive cues from global peers as most of the sectoral indices dropped. The Sensex after a soft opening, started losing strength. The index extended losses in late-noon trades and touched a low of 17,850.
The BSE benchmark finally ended with a loss of 1.5% at 17,879. Nifty shed 1.5% during the day to end at 5,374.
The political troubles of the ruling UPA government seemed to be far from over as the opposition demanded the resignation of Prime Minister Manmohan Singh following a wikileaks cable showing bribes had been given for votes during the Indo-US nuclear treaty.
The Congress, which is already burdened by corruption charges, however, denied all such allegations.
India's tax revenue for the financial year 2011 increased 26% over the corresponding year.
The government had revised the target of Rs 3,15,000 crore for indirect tax to Rs 3,36,000 crore.
A 25% jump in advance tax payments by companies in the fourth quarter showed a robust earning.
Meanwhile, global indices were in the positive zone. Japan seemed to finally recover from its shocking earthquake and nuclear troubles. The Nikkei gained 2.7% at 9,206. Taiwan Weighted and Seoul Composite added over 1% each in trades.
BSE mid and small-cap indices outperformed the benchmark and were down 0.4% and 0.7%, respectively.
All the sectoral indices were in red. BSE metal index erased early gains and slipped into red towards the close.
Index heavyweight, Tata Steel gained 0.3% at Rs 596 following a buzz of price hike. Nalco gained 3.3% to Rs 108 while NMDC jumped 3% to Rs 280. Welcorp and JSW Steel were up marginally in trades.
However, BSE oil & gas index shed 2.6%. IT stocks fell on fears that the Japanese earthquake may have a fallout on international deals and hit plans of inorganic growth.
Tech Mahindra, Financial Technologies, Oracle Financial Services and HCL Tech were down 1-4%
each.
All three IT heavyweights, TCS, Infosys and Wipro shed over 1% today.
Realty and bankex were down - a day after the RBI hiked repo and reverse repo rates by 25 basis points each.
"The policy rates are already higher than neutral rates, further tightening will hurt investment growth. Hence, any increase in rates may come at the expense of growth.
Nonetheless, given the inflationary pressures, RBI is likely to persist with its current anti-inflationary stance. We expect further rate hikes of 50bps in the current calender year", said Edelweiss Research.
Reliance was the biggest dragger in the Sensex, slipping on reports that the gas output at the KG gas basin may delcine in FY13.
The stock shed 3.7% to Rs 993. Reliance Infrastructure dropped 3.8% to Rs 627. Reliance Communications was down 2% at Rs 105.
Mahindra & Mahindra dropped 3.3% to Rs 633.
Other auto stocks were also in red. Hero Honda slipped 2.3% to Rs 1,474. Tata Motors dipped 2% to Rs 1,118.
Maruti Suzuki dipped in trades as Japanese worries continued to weigh.
HDFC, BHEL, Cipla, HDFC Bank, SBI and ONGC were among the losers.
Multiplex stocks slipped on news that they would cut down prices in absence of any big releases. Inox Leisure tumbled 3.2% to Rs 49. PVR slumped 6% to Rs 98. Cinemax crashed 7% to Rs 46.
Crude prices remained high as the crisis in Middle East continued. Brent crude was trading at $116.56. PSU OMCs slipped with crude oil gaining strength.
Aviation stocks also dropped on fears that ATF may mirror the rise in crude price. HPCL and BPCL shed 2% each while IOC dropped 1% in trades. Among aviation stocks, Spicejet tumbled 4% while Kingfisher and Jet Airways dropped 3% each.
The BSE market breadth weakened after showing strangth in opening trades. It ended with 1,048 stocks advancing and 1,801 stocks declining out of a total of 2,969 stocks traded on Friday.
