BANGALORE, Jan 31 (Reuters) - Indian shares on Monday posted their worst monthly fall in more than two years, tracking weak global markets as anti-government protests in Egypt led to risk aversion, with inflation and rate rise fears further dampening sentiment.
The 30-share BSE index .BSESN shed 0.4 percent on Monday leading to a 10.6 percent fall in the month, its lowest since October 2008.
"There is a lot of concern in the market about food security, oil prices," said Arun Kejriwal, director of research firm KRIS.
"Most certainly a dead cat bounce is overdue, but I am not sure if that will make a difference to the direction of the market."
Telecoms stocks ended lower on India's plan to de-link second-generation radio (2G) spectrum that now comes free with telecoms licences and ask companies to pay for spectrum based on market-linked prices. [ID:nSGE70S00S]
Bharti Airtel (BRTI.BO) ended 2.6 percent lower, while Reliance Communications (RLCM.BO) shed 2 percent. Idea Cellular (IDEA.BO) closed 0.8 percent lower.
The top two software firms Tata Consultancy Services (TCS.BO) and Infosys Technologies (INFY.BO) were among the top losers, falling 2.2 percent and 1.8 percent respectively, on growing uncertainty about the outsourcing business momentum.
The chief executives of Tata Consultancy and Infosys told Reuters last Friday at Davos that Europe's debt crisis and rising inflation at home could slow the growth that they have enjoyed in recent years. [ID:nN28167216].
The main index fell 68.2 points to close at 18,327.76, with 17 of its components losing ground.
"Egypt is not a very big market for foreign institutional investors. There will be a reaction because of how it may affect the other regions, but a major reaction won't happen in India," said R.K. Gupta, managing director of Taurus Mutual Fund.
More than 100 people have been killed during six days of protests in Egypt aimed at toppling President Hosni Mubarak.
A wider conflagration in the region could threaten the flow of oil at a time when policymakers in emerging markets are already bedeviled by high food and fuel prices and some developed economies are gaining momentum
Indian shares record worst monthly fall in over 2 yrs
Tuesday, February 01, 2011
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