Sensex down 50 points after touching 30-month high

Extending the losses for the second successive day, the Bombay Stock Exchange (BSE) benchmark Sensex closed 50 points lower today, with fag-end profit-booking in banking and auto stocks erasing early gains.

The 30-share index closed down by 50.28 points, or 0.28%, at 17,878.14. Analysts said weak cues in European bourses and lower opening of US futures prompted investors to book profits overlooking the positive domestic trends.

The wide-based National Stock Exchange's 50-share Nifty index, too, lost 0.34% to settle at 5,368 points.

Markets surged in early trade on positive export data and the Asian Development Bank's upward revision of growth estimates for the region to 7.9%. The Sensex even touched the 30-month high of 18,040.17 points intra-day.

Buoyed by rising exports and the impact of stimulus packages on Asian economies, the ADB today raised the growth forecast for the region to 7.9%, but retained the projection for India at 8.2% for 2010.

Exports in June rose over 30%, reflecting increased economic activities.

Analysts said investors were,however, better influenced by weak trends in European bourses which triggered profit-booking.

"Investors are trading very cautiously and the market is not able to break the range-bound trend. The market is waiting for bigger triggers to go forward," Networth Stock Broking's Head of Institutional Sales & Strategy Prakash Diwan said.

ICICI Bank lost 1.22%, HDFC 1.24% and SBI 0.31%. HDFC Bank declined 0.29%, a day after it posted a 34% rise in its June quarter profit to Rs811 crore.

Another casualty was auto stocks, with Tata Motors sinking 1.57%, M&M 0.88%, Maruti 0.15% and Hero Honda 0.21%.

In the Sensex pack, 20 stocks ended with losses, while 10 managed to close with gains.

Reliance Industries, which carries the maximum weight in the Sensex, ended 0.32% lower at Rs1,052.90.

Anil Ambani-led Reliance Communications, which had jumped 2.22% yesterday on stake sale reports, today lost steam and ended 1.52% down.

Jaiprakash Associates plunged 1.74%, the most in the BSE-30, and Infosys 0.46%.

However, realty, metal and consumer goods stocks attracted buying and, to some extent, capped the fall in the Sensex.

DLF surged 2%, the most in the Sensex, followed by Sterlite Industries, which rose 1.53%. Wipro climbed 0.93% and L&T 0.53%.