Markets End on a Negative Note

It was a double whammy for the markets today as Infosys fourth quarter results were below analysts' estimates and inflation for the month of March surpassed the Reserve Bank of India target of 8% raising expectations of further rate hikes. Markets gave up most of the gains made in previous session as traders’ dumped frontline IT shares after Infosys reported 17% jump in net profit y-o-y, trailing street expectations. Infosys dragged the Sensex down by 193 points and Wipro and TCS contributed to another 30 points slide. The Sensex ended down 310 points, at 19,387 and the Nifty declined 87 points, at 5825. Inflation accelerated the RBI target of 8% in March which may prompt the Reserve Bank of India to tighten further in the upcoming policy review on March 23rd. Rising prices of vegetables and manufactured items drove the headline inflation to 8.98%. The overall inflation measured on the basis of Wholesale Price Index (WPI) was 8.31% in February. Broader markets were also weak, the midcap and small cap indices were down 0.2%% each. Market breadth was negative, 1597 shares declined for 1303 shares that advanced.