The Indian stocks ended the day on a weak note with the market further declining during the final hour of trade. The BSE-Sensex closed with losses of about 185 points or 0.8%. The NSE-Nifty closed lower by about 64 points or 0.9%. Barring stocks from the consumer durables and power spaces, losses were seen across the board. Information technology and realty stocks were amongst the least preferred today. The BSE Mid Cap and BSE Small Cap indices ended the day on a weak note as well, with the indices closing lower by about 0.1% each.
Stock markets in other parts of Asia ended the day on a weak note with Japan, China and Hong Kong closing lower by about 2.9%, 0.9 and 1.1% respectively. The rupee was trading at Rs 60.04 to the dollar at the time of writing.
Stocks of information technology companies ended the day on a weak note with HCL Technologies, Tech Mahindra and Infosys leading the losses. As reported by a leading business daily, IT major HCL Technologies won a contract worth US$ 400 m (Rs 24 bn) from DNB Bank ASA, a bank based in Norway. The scope of work would be to manage the bank's IT infrastructure services and application operations on a global scale. As per the company, it will migrate and transform the bank's infrastructure from its existing IT partner and will create two new data centres in Norway. This deal will provide a fillip to the company's infrastructure management and enterprise application system divisions, areas which grew by 4.1% and 2.6% on a quarter on quarter basis i.e. in comparison to the preceding quarter ended December 2013. However, despite announcement of this development, the stock of HCL Technologies ended lower by about 4.7%.
Stocks of real estate companies ended the day on a weak note led by HDIL, Unitech and Godrej Properties. As reported by a leading business daily, property prices have fallen by as much as 20-30% in Indian metros over the past year. Apart from the seemingly inflated prices that have led to lower demand, the reasons for the price declines are working capital pressures for the developers, especially at a time when the buyers have disappeared. As per HDFC Chairman Deepak Parekh, secondary sales have slowed down and prices in the segment have come down. Not to mention the uncertainty over the economy and the run up to May 16, the date the elections results get announced. There have been reports that unsold inventory levels have risen from 650,000 apartments in the quarter through December to 700,000 at the end of March 2014.
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