Markets take a hit on new spectrum norms

The stock markets dropped for the second day on Tuesday. Bharti Airtel and Reliance Communications fell on concern the government's plan to impose new rules on the use of airwaves used to offer wireless services may hurt growth.

"We expect capital expenditure and operating expenses to increase significantly if the government implements a stricter spectrum allocation policy,'' analyst Kawaljeet Saluja at Kotak Securities said in a note to clients.

State Bank of India, the country's largest lender, fell Rs 31.5, or 1.4 per cent, to Rs 2,208.75 after it had its stock rating cut to "hold'' from "buy'' by Deutsche Bank.

The Bombay Stock Exchange's Sensex dropped 190.11, or 1 per cent to 19,400.67. The S&P CNX Nifty on the National Stock Exchange slid 60.80, or 1 per cent, to 5,786.50. The Nifty futures for November delivery fell 0.4 per cent to 5,822.10.

Bharti, the country's largest mobile phone operator, fell Rs 23.75, or 2.5 per cent, to Rs 918.45. Reliance Communications, the country's second largest, dropped 4.4 per cent to Rs 745.40. Idea Cellular slid 1.5 per cent to Rs 130.10.