By Abhishek Vishnoi
MUMBAI (Reuters) - The BSE Sensex and Nifty fell for a fourth straight session on Monday, marking their lowest close in 2-1/2 weeks as ITC Ltd slumped the most in ten months on tax worries, while concerns over high oil prices feeding inflation continued to weigh.
Brent crude was up at around $115 a barrel on Monday, supported by worries about potential disruptions to supply from Iraq where Sunni insurgents took control of strongholds along the border with Syria at the weekend.
Falls also tracked European stocks after euro zone business activity data showed growth slowing, with France a notable laggard, in contrast with upbeat numbers from China.
Also, overseas investors sold shares worth 2.20 billion rupees ($36.85 million) on Friday, provisional exchange data showed.
Investors also turned cautious ahead of the new government's budget on July 10, which will hold details of the borrowing plan for 2014/15.
"There is an uncertainty and people are waiting for budget for clarity on major policy issues. However, market is optimistic and is expecting some real good measures. That is why we are not seeing any heavy selling," said Suresh Parmar, head, institutional equities at KJMC Capital Markets
The Sensex lost 0.3 percent, or 74.19 points, to end at 25,031.32.
The Nifty fell 0.24 percent, or 18.10 points, to end at 7,493.35, closing below the psychologically important 7,500 level.
Both indexes marked their lowest close since June 5.
India's biggest cigarette manufacturer ITC slumped 6.2 percent, its biggest single-day fall since Sept. 3, 2013, on a media report that government may raise taxes on cigarettes aggressively in the upcoming budget, dealers said.
Kotak Mahindra Bank fell 3.8 percent while Infosys lost 2.5 percent.
Among other blue-chips, United Spirits fell 3.2 percent while Hindustan Unilever ended down 1.1 percent.
UltraTech Cement fell 0.6 percent after the government on Friday pushed through a steep 6.5 percent hike in rail freight effective June 25.
However, sugar refiners gained after the food minister said on Monday that India would raise import duty on sugar to 40 percent from 15 percent, as the government tries to revive business at mills that owe farmers around $1.84 billion.
Bajaj Hindusthan Ltd surged 9.9 percent, Dhampur Sugar Mills Ltd advanced 8.2 percent, Shree Renuka Sugars Ltd rose 10.3 percent, and Balrampur Chini Mills Ltd gained 6.9 percent.
Essar Oil Ltd rose 5 percent and AstraZeneca Pharma India Ltd gained 1.9 percent on plans of delisting the companies from Indian exchanges.
(Editing by Sunil Nair)
