Sensex falls for 5th day; ITC falls, Tata Motors up

The BSE Sensex ended lower for the fifth straight day on Thursday suggesting the continued consolidation in the markets after the sharp up move that took the Nifty to a 23-month high earlier this week.

The Sensex closed 126 points or 0.65 per cent lower at 19,229 while the broader Nifty declined 36.5 points to 5,851. The rupee traded lower against the dollar at 54.49.

SV Prasad, chairman at Chime Consulting says consolidation is always healthy for markets, though the rupee dollar rate remains a concern.

"The biggest good news is the continued FII flows. In many ways, that's driving the markets and with the government not blinking... a lot of policy decisions going through," he added.

A Reuters poll said wholesale prices likely rose at 7.6 per cent in November from a year earlier, compared with 7.45 percent in October. Rising inflation indicates the Reserve Bank of India is unlikely to cut rates on December 18, which may be weighing on sentiments.

The BSE FMCG index ended 2 per cent lower on the back of sharp selloff in ITC and HUL shares.

Index heavyweight ITC declined 3.5 per cent after FTSE lowered its free float weighting for the cigarette maker in its global equity index series, according to the website of the index provider.

Hindustan Unilever shares fell for the second day on worries that it will face higher royalty payments to Unilever PLC. Concerns came after Unilever's Indonesian subsidiary, Unilever Indonesia, has agreed to pay a royalty payment to the parent company.

Cement maker ACC fell 1.8 percent after the board approved payment of technology and knowhow fees to its parent Holcim Limited.

The strong gains in Tata Motors propelled the BSE Auto index. Jaguar Land Rover's global retail sales rose 14 per cent in November driving Tata Motors shares up 4.1 per cent.

Among other stocks, Kingfisher Airlines rose for the eighth straight day after the grounded carrier informed the Bombay Stock Exchange (BSE) that its Board has capped foreign portfolio investment in the company at 3 per cent, carving space for a foreign investor to buy as much as 46 per cent of the carrier..  

Kingfisher shares were locked up in upper circuit, rising by their daily limit of 5 per cent to Rs 17.27 on the BSE. Kingfisher shares have more than doubled since hitting an all-time low of Rs 7.05 in August.


(With inputs from Reuters)