Sensex Snaps Four-Day Winning Streak

NDTV Profit Desk

14 May 2014, 05:03 PM IST

The BSE Sensex and Nifty retreated on Wednesday from record highs hit in the prior session, snapping a four-session winning streak as investors booked profits in blue-chips such as HDFC Bank ahead of the release election results on Friday.

Shares have surged on widespread expectations that the opposition Bharatiya Janata Party, and its prime minister candidate Narendra Modi, are set to win a majority in the elections when results are unveiled on Friday.

The Nifty has gained 21.50 per cent since Sept. 13 when Modi was named as BJP's prime ministerial candidate, with foreign investors buying heavily.

Their net purchases accelerated over the previous three sessions, reaching a net Rs 6,339 crore ($1.06 billion) when including index futures.

"What we as investors in India crave is stability and certainty. A result north of 240 seats for Modi would likely deliver him the PM's office and a host of willing coalition partners - in other words a stable government," Jonathan Schiessl, Asian equities specialist at Ashburton Investments in Jersey, said in an email to Reuters.

"Much is hanging on this election result, not only for investors in the India story," Schiessl added.

The Sensex fell 0.24 per cent, or 56.11 points, to end at 23,815.12 after hitting a record high of 24,068.94 on Tuesday.

The Nifty ended flat at 7,108.75, after touching an all-time high of 7,172.35 a day earlier.

Among blue-chips, HDFC Bank declined 1.6 per cent after making a life high of Rs 800 on Tuesday, while Reliance Industries ended 1.7 per cent lower.

Bharat Heavy Electricals slipped 1.2 per cent after surging 10.2 per cent on Tuesday, while Larsen & Toubro ended 1.1 per cent lower.

Dr. Reddy's Laboratories dipped 3.5 per cent adding to its 4.1 per cent fall on Tuesday as the drugmaker continues to be hit by disappointment over its January-March earnings.

Nestle India fell 2 per cent after the company reported lower-than-expected earnings in the January-March quarter.

However, state-run banks gained after a committee appointed by the Reserve Bank of India proposed on Tuesday the government should cut its stakes in state banks to below 50 per cent.

State Bank of India rose 0.3 per cent, Oriental Bank of Commerce gained 3.8 per cent, Punjab National Bank rose 4.3 per cent while Canara Bank surged 10.5 per cent higher.

Tata Steel gained 5.9 per cent, after earlier hitting its highest level since July 2012, ahead of its Jan-March results later in the day.