Markets slip further, Sensex down 130pts

Markets have extended losses after the 2G court today yet again rejected the bail plea of DMK chief Karunanidhi's daughter Kanimozhi. The Sensex had opened soft on global cues and is now down 129 points at 17,335. Nifty is down 41 points at 5,217.

The bail pleas of Sharad Kumar, Rajeev Agarwal, Karim Morani and Asif Balwa have been dismissed. The Central Bureau of Investigation (CBI) did not argue in the court against the rejection of the bail pleas. The 2G trial has been scheduled to start on November 11.

Asian markets continued to languish. Nikkei shed 2.2% to 8,640. Hang Seng was down 1.6% at 19,426. Markets globally will be looking at the Euro zone meet to be held tomorrow to decide the solution to the debt problem.

Meanwhile, India's service sector contracted for a second straight month in October, as new business grew at its weakest pace since May 2009, a survey showed on Thursday, dragged by sagging global demand and tight monetary policy. The seasonally adjusted HSBC Markit Business Activity Index, based on a survey of around 400 firms, slumped to 49.1 in October, its lowest reading in two-and-a-half years and below the 50-mark which separates growth from contraction. It was at 49.8 in September.

Most of the sectoral indices were in red with the IT index down 1% at 5,714.  BSE bankex, metal and FMCG indices slipped 0.5-1% each.

HDFC Bank slipped 1.7% to Rs 475 and was the biggest contributor to the Sensex's fall. Infosys and ICICI Bank also dragged the market down by 35 points.

Hindustan Unilever dropped 2.2% to Rs 382, followed by Sterlite, ONGC, Hero Motocorp and Tata Steel.

Meanwhile, BHEL gained 1.7% to Rs 322. Tata Power and Cipla added 1% each.