Markets drop 0.2%; Infosys seesaws

Indian shares were trading 0.2% lower on Tuesday morning, dragged by lower Asian peers, while Infosys Technologies rose as it forecast stronger-than-expected annual revenue growth of 16-18 percent. The country’s no. 2 software services exporter Infosys reported a 0.9% drop in quarterly profit, and forecast June quarter consolidated earnings per share to grow up to 1.8%. A. N. Sridhar, a fund manager at Sahara Mutual Fund called the company’s earnings per share outlook for this quarter “quite conservative.” “I think going forward the currency movements, especially that of the rupee and dollar will play a significant role in the financial performance,” he said, adding the management had rightly expressed concerns on it. The stock was up 2.1 in choppy trade, after falling as much as 1.8%. By 11:21am, the 30-share BSE Index was trading down 0.19% at 17,819.50, with 22 of its components declining. The benchmark is up 1.7% so far this year. Foreign funds have poured in around $5.2 billion in Indian equities so far in 2010, a portion of which was absorbed by primary market issuance. “The underlying sentiment in the market is still positive, as results are not likely to disappoint,” said Neeraj Dewan, director of Quantum Securities from New Delhi. Financials edged lower, weighed down by concerns over rising inflation. India’s March inflation will be “pretty high,” Kaushik Basu, chief economic adviser in the finance ministry, had told reporters on Monday. He added that core inflation, excluding food and fuel prices, is around 5.5% currently. Top lender State Bank of India fell nearly 1%, while leading private lenders ICICI Bank and HDFC Bank shed 1.5% and 0.1% respectively. Energy giant Reliance Industries, which has the highest weight on the Sensex, was down 0.5% at Rs1,120.45. In the broader market, gainers almost equalled the number of losers in a volume of 147 million shares. The 50-share NSE index was down 0.2% at 5,328.