Indian shares slip

Indian share prices slipped 0.91 percent on Wednesday as investors locked-in gains over concern that the central bank may raise interest rates in the face of fast economic growth, dealers said. They said the benchmark index fell on renewed concern of higher interest rates after industrial output reported Tuesday rose a surprise 13.6 percent in April.
The 30-share Sensex index fell 127.92 points to 14,003.03. Losers led gainers 1,257 to 1,142 on volume of 41.69 billion rupees (1.01 billion dollars). The rupee weakened against the dollar to 40.93 from 40.73 and also fell against the euro to 54.46 from 54.44. "We have seen a move to lock-in profits in the face of interest rate concerns," said Karun Mehta, an analyst with Mumbai-based IL&FS Investments.
The central bank has raised short-term lending rates twice in 2007 to cool the economy and tame inflation above six percent. But the industrial production growth in April showed that demand is still strong even as inflation has waned, Mehta said.
Inflation, as measured by wholesale prices, fell to its lowest level in nearly a year at 4.85 percent in the week to May 26, according to the latest data. The country's largest lender, State Bank of India, fell 42.45 rupees or 3.19 percent to 1,289.40 while leading conglomerate Reliance Industries declined 25.05 rupees or 1.53 percent to 1,673.50.