Indian shares fall

Indian shares slipped 1 percent on Tuesday as investors took fright of political opposition to opening up the retail sector to multinationals, which could further slow down dwindling growth and hit investment. Prime Minister Manmohan Singh failed to break an impasse with opposition parties and his own allies demanding a rollback of the reform announced last week allowing foreign supermarket giants to enter a $450 billion market.
K.K. Mital, head of portfolio management services at Globe Capital Markets, said the deadlock dashed expectations the ruling coalition, which has been blamed for policy paralysis after a series of corruption scandals, would pursue more reforms.
Property developer DLF fell 3.3 percent on uncertainty about the retail sector reform, after having rallied 7.1 percent over three sessions on hopes the liberalisation would boost demand for malls. Pantaloon Retail fell 11.9 percent, while Trent and Shoppers Shop lost more than 3 percent, chipping away some of the sharp gains made in previous sessions on hopes for tie-ups with foreign companies.
The main 30-share BSE index closed down 0.98 percent, or 158.79 points, at 16,008.34, with 20 of its components closing in the red. The benchmark, which is one of the world's worst performers this year having fallen 21.9 percent since the start of January, had pulled back 3 percent on Monday on hopes for more market-friendly reforms.
The 50-share NSE index dropped 0.95 percent to 4,805.10 points. In the broader market, 872 losers were ahead of 561 gainers on total volume of 571.96 million shares. The data is scheduled for release on Wednesday. Citigroup has cut its growth estimate for India to 7.1 percent for the fiscal year ending March from its earlier forecast of 7.6 percent, citing domestic factors such as supply-side bottlenecks in the coal and power sectors and lagged impact of monetary tightening.
Reliance Industries, which has the heaviest weight on the main index, fell 2.4 percent after the energy major said it began arbitration proceedings against the government to keep its entitlement to recover costs related to KG-D6 block, off India's east coast.