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Sensex plunges 300 pts as Infosys sees worst-in-decade fall of 21%

Hit by over 21 per cent plunge in Infosys shares on disappointing earnings, the Bombay Stock Exchange’s (BSE) benchmark 30-share Sensitive Index (Sensex) on Friday tumbled by nearly 300 points to end at 18,242.56 despite better-than-expected industrial production as well as consumer price inflation data.

The Sensex, which had gained 316 points in the last two sessions, dropped by 299.64 points, or 1.62 per cent to 18,242.56. Similarly, the broad-based National Stock Exchange index Nifty lost 65.45 points, or 1.17 per cent to 5,528.55.

The second biggest software exporter, Infosys plunged by 21.33 per cent to Rs 2,295.45, recording its biggest single day fall since April 2003, after lower-than-expected revenue outlook for fiscal 2013-14 and disappointing Q4 earnings. 'The main reason for the decline in benchmark indices was the big fall in share price of Infosys,' said Nagji K Rita, Chairman & MD, Inventure Growth and Securities.

Markets ignored sentimentally positive macroeconomic data like February Index of Industrial Production (IIP) at 0.6 per cent against street expectations of a marginal decline and Consumer Price Index (CPI)-based inflation declining to 10.39 per cent in March, said brokers. 'Better-than-expected numbers on IIP and CPI inflation was a mix of sustainable and one-off factors,' said Kotak Mahindra Bank Chief Economist Indranil Pan.

After the steep fall in Infosys, which alone dragged the Sensex deep into negative terrain, other software exporters such as Tata Consultancy Services (TCS), HCL Technologies, Wipro and Tech Mahindra too declined. In the 30-share Sensex pack, 13 stocks declined while 16 gained led by ITC, State Bank of India and Reliance Industries Ltd.

Sectorally, the IT sector index suffered the most by falling 11.09 per cent to 6,040.48, followed by tech index by 1.87 per cent to 3,506.81. Capital goods index fell by 0.69 per cent to 8,940.19 and consumer durable index by 0.61 per cent to 6,958.57.
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