India Shares End Lower; Monsoon Delay Raises Concerns
07/02/2012| 07:27am US/Eastern
By Ashutosh Joshi
MUMBAI--Indian shares ended slightly lower Monday as traders balanced portfolios by selling stocks in some auto and consumer goods companies after sharp gains Friday.
Also pulling down shares were worries that a delayed progress of India's crucial monsoon rains could hit summer crops.
The Bombay Stock Exchange's benchmark 30-share Sensitive Index closed down 31.00 points, or 0.2%, at 17,398.98, while the National Stock Exchange's 50-share Nifty was flat, slipping 0.30 points, or 0.01%, to 5,278.60.
The trading volume in the BSE's cash segment was 19.26 billion rupees. Gainers outnumbered decliners 1,807 to 1,033, while 108 stocks remained unchanged.
The monsoon is vital to India's agricultural sector as well as the overall economy because more than 60% of the country's farmland is rain-fed.
The seasonal rains usually cover most of the country by July 1, but this hasn't happened this year, with northern states such as Punjab and Haryana still waiting for the monsoon.
Sailav Kaji, chief strategist with Padmakshi Financial Services, said that the markets are likely to remain firm for the next few days, mainly tracking positive developments in Europe.
European stocks were trading in the green Monday, extending last week's rally which started after a summit meeting of European Union leaders came up with better-than-expected progress on shoring up the euro-zone banking sector.
Asian stocks were, however, mixed as data showed a regional slowdown in manufacturing.
In India, consumer goods maker ITC pulled down the Sensex in the last hour of trading, slipping 3.4% to 250.10 rupees. Information technology major Tata Consultancy Services gave up 1.4% to 1,260.20 rupees.
India's top auto makers reported contrasting sales numbers for June.
Tata Motors fell 1.6% to 238.35 rupees. The company's car and SUV sales for the month were down 22% as demand for its Indica-branded hatchbacks and Indigo sedans continued to remain weak.
Maruti Suzuki India and Mahindra & Mahindra gained as the two companies benefited from strong demand for diesel vehicles.
Maruti Suzuki rose 0.9% to 1,180.60 rupees, while Mahindra gained 1% to 713.75 rupees.
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