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Markets extended losses in late morning trades weighed down by profit taking in FMCG majors after recent gains. Meanwhile, investor are adopting a wait-and-watch stance ahead of expiry of July derivative contracts.
At 10:50AM, the 30-share Sensex was down 47 points at 20,043 and the 50-share Nifty was down 18 points at 5,972.
Stocks in Asia which recently touched seven-week highs witnessed profit taking at higher levels. Japan's Nikkei was down over 1% while Hang Seng, Shanghai Composite and Straits Times were down 0.1-0.8% each.
The BSE FMCG index was the top loser among the sectoral indices down 1% followed by Power, Capital Goods, Healthcare, Metal and Consumer Durables down 0.3-0.8% each.
FMCG majors ITC and Hindustan Unilever witnessed profit taking at higher levels after recent gains. ITC was down 1.1% while Hindustan Unilever which was trading flat in early trades dropped 2.4%.
Capital Goods shares continued to exhibit a weak trend post disappointing results from L&T.
L&T was down 1.1% and BHEL slipped 2.5%.
Other Sensex losers include, ICICI Bank, Sun Pharma, Tata Power while index heavyweight Reliance Industries was down 0.3%.
Ambuja Cements was down 13% at Rs 166 amid downgrades by brokerages following dismal earnings in the June quarter. The cement major reported 31% year-on-year (yoy) decline in its June quarter profit to Rs 324 crore on higher input cost and lower realization. Net sales too decline about 9% yoy to Rs 324 crore due to weak demand in certain regions.EBITDA or operating margins contracted 700 bps to 21% as realisations remained lower.
Hero MotoCorp gained 4.4% to Rs 1,835 after reporting 100 bps improvement in operating margins at 14.8% for the first quarter ended June 30, 2013 on sequential basis due to 10% quarter-on-quarter decline in other expenditure. The company had operating margins at 13.8% in March quarter.
Among other shares, Central Bank of India has tanked 8.1% to Rs 57 on reporting a sharp 94% year-on-year (yoy) drop in net profit at Rs 22 crore for the quarter ended June 30, 2013 (Q1) due to higher provisions for rising bad loans.
Novartis India has slipped 4.3% to Rs 451 after reporting 49% year-on-year (yoy) decline in net profit at Rs 139 crore for the quarter June 30, 2013 due to rupee depreciation and lower sales volume. The pharmaceutical company had profit of Rs 270 crore in year ago quarter.
The broader market was weak with BSE Mid-cap index down 0.5% and Small-cap index down 0.2%.
Market breadth weakened with 955 declines and 603 advances on the BSE.
