India shares fall for sixth day on agonize over earnings growth

Indian shares fell for the sixth consecutive day on Wednesday, reversing early gains, as investors remained concerned about the impact of demonetization on earnings growth.

The benchmark BSE Sensex index declined 0.3% to 26,242.38, its lowest level since Dec. 7 and down a cumulative 1.7% since the Dec. 13 close. The broader NSE Nifty 50 index ended 0.3% lower at 8,061.30 points, its lowest level since Nov. 24.

Software stocks, cigarette-maker ITC and Sun Pharmaceutical Industries were among the top losers, while private lender ICICI Bank and car maker Maruti Suzuki India were the few stocks that ended in the green.

“Due to the upcoming holiday season, markets have been trading with a weak bias,” said G. Chokkalingam, managing director at Equinomics Research & Advisory. “While a crash is unlikely, we can see indexes falling another 2%-3% as the outlook for several sectors are looking bleak due to the demonetization.”

Fifteen of the 30 Sensex constituents finished lower, while overall declining issues beat advancing ones 1,415 to 1,172 and 170 stocks ended unchanged on the BSE.

BSE Information Technology index fell 0.8%, with Infosys falling 0.7% to 1,003.70 rupees. Larger rival Tata Consultancy Services dropped 1.1% to 2,312.75 rupees and peer Wipro lost 0.9% to 462.55 rupees.

Shares of these companies, whose fortune is linked to the U.S. economy, have outperformed other sectors lately on the back of strengthening dollar and expectations of pro-growth policies by President-elect Donald Trump.

Infosys has gained 2.7% so far this month, while Tata Consultancy surged 6.6% in the previous five sessions.

ITC, which has among the highest weight in the index, fell 1.4% to 226.10 rupees.

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