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Benchmark share indices ended lower on Thursday, amid a volatile trading session, with IT majors declining the most after the rupee appreciated against the US dollar and lower revenue growth guidance from its competitor Cognizant.
The S&P BSE Sensex lost 76 points to end at 25,589 while the CNX Nifty shed 23 points to end at 7,649.
"Due to weakness at certain clients and longer-than-anticipated sales cycles for certain large integrated deals, we are adopting a more conservative stance for the remainder of the year and revising our 2014 revenue guidance to growth of at least 14% over the prior year, while maintaining our full year non-GAAP EPS guidance of $2.54,” Cognizant CEO Francisco D’Souza said in a statement.
The company had earlier projected a growth rate of 16.5%. The revised guidance would mean that Cognizant will be growing at its slowest ever in its 20-year history.
The broader markets ended in line with the large counterparts. BSE Midcap and Smallcap indices slipped by 0.5%, each.
Across the Globe:
Asian shares barring Nikkei retreated while investors flocked to safe haven assets such as bonds and gold on Thursday, spooked by a Russian troop build-up on the border with Ukraine and tit-for-tat economic sanctions between the West and Moscow.
Sentiment soured further in Asia after the Australian dollar, seen as a barometer of risk appetite, sank after Australia's unemployment rate jumped unexpectedly to a 12-year high, sparking talk of an interest rate cut there.
Japan's Nikkei gained 0.4%. However, Hang Seng dipped 0.8%, Straits Times slipped 0.1% and Shanghai Composite dropped 1%.
European shares were also trading weak as investors turned cautious on concerns over the emerging tensions between Ukraine and Russia. The CAC-40, DAX and FTSE-100 were down 0.2-0.4%.
Rupee:
The rupee is trading stronger at 61.30/31 versus its Wednesday's close of 61.4950/5050, tracking the dollar's losses versus major currencies. The index of the dollar against six majors is down 0.04%. The pair is seen in 61.10 to 61.60 range during the session. Asian currencies are trading mixed compared with the dollar.
Foreign institutional investors sold equities worth Rs 364 crore during this month so far, as per stock exchange data.
Sectors and Stocks:
On the sectoral front, BSE IT, which was the top losing index lost over 1% followed by Teck, Healthcare, Realty, Power and Auto indices index. However, Oil and Gas index inched up 0.3%. BSE Bankex ended flat.
Oil and Gas major ONGC ended up 1%. RIL ended marginally in green.
The Auto shares ended mixed. M&M surged nearly 1%, Hero Motocorp gained 0.2%. In contrast, Tata Motors lost 1% and Baja Auto ended marginally in red.
BHEL climbed 0.5%, whereas, L&T lost 0.3%.
ICICI Bank, SBI and HDFC twins gained during the noon trades on fresh buying and ended up between 0.1-0.6%.
On the losing end, the shares of information technology (IT) companies ended lower, after global IT giant Cognizant scaled down its annual revenue growth estimate citing weakness at certain clients and long sales cycles for certain large deals.
The US-headquartered company said it expected its annual revenue growth for FY14 (Cognizant follows a January-December financial year) to be at least 14%, against the earlier estimate of 16.5%. TCS and Infosys ended lower by over 1.5%, each. Wipro inched up 0.3%.
The metal pack ended mixed. Hindalco and Sesa Sterlite ended 1% lower. However, Tata Steel and Coal India gained between 0.5%-1%.
Drug maker Sun Pharma lost 0.3%. However, Cipla ended marginally in green. Dr Reddy's lab gained 0.3%.
GAIL, L&T, Axis Bank and Tata Power were some of the prominent names in red among the others.
Among other shares, Stocks of companies associated with the railways rallied on the bourses after the Union Cabinet on Wednesday cleared the proposal to allow 100% foreign direct investment (FDI) in railway infrastructure.
Shares of wagon maker Texmaco Rail and Engineering gained 4 % to Rs 95 on the Bombay Stock Exchange (BSE).
Bhushan Steel tanked 20% to Rs 244, also its lowest level since November 2009 on BSE, after Delhi court dismissed the anticipatory bail plea of the company’s vice-chairman Neeraj Singhal in connection with the Syndicate Bank bribery case.
Jubilant Industries plunged 20% to Rs 106 after reporting a consolidated net loss of Rs 18.90 crore for the first quarter ended June 30, 2014 (Q1), due to lower operational income and higher interest cost. The agrochemicals company had loss of Rs 16.96 crore in the same quarter last fiscal.
The market breadth ended weak on the BSE with 1,616 shares declining and 1,320 shares advancing.
