Sensex edges lower, telecom stocks under pressure

Stock markets gave up early gains on some profit-taking after the recent gains. In the previous three sessions, the Sensex gained over 2 per cent.

The Sensex was down 44 points at 21,244. At its day’s high, the Sensex rose 90 points to 21,379.29.

Telecom stocks were under pressure as analysts expect aggressive bidding for the forthcoming 2G auction after the entry of Reliance Jio Infocomm (RJI), the telecom arm of Reliance Industries. The auction would start from February 3 and including Reliance Jio there are eight companies in the fray.

Credit Suisse downgraded Bharti Airtel to neutral, saying that RIL’s entry is against current market expectations. The brokerage cut Bharti’s earnings estimate by 22-38 per cent for 2014-15 and 2015-16. Another multinational brokerage Goldman Sachs said aggressive bidding will open up downside risks for Bharti.

Bharti shares fell 4.6 per cent, Idea was down 5.8 per cent, while RCom was declined 3.3 per cent.

HCL Tech hit a new all-time high today on strong quarterly results. HCL Tech was up 2.9 per cent at Rs. 1,368. The shares hit an all-time high of Rs. 1,377 today. TCS was down 0.6 per cent ahead of its quarterly results due later in the day.

Metal stocks saw some buying with Tata Steel, Sesa Sterlite and JSPL advancing between 1.5 per cent and 2.6 per cent.