Indian shares provisionally closed 0.95 percent lower on Friday, as investors booked profits on renewed worries about rising global oil prices and the country's widening fiscal deficit. The main 30-share benchmark index provisionally fell 172.14 points to 17,906.36, with 17 of its components in the red. The broader 50-share NSE index provisionally closed 1.07 percent lower at 5,424.85.
Indian shares were heading for their first weekly fall in eight weeks, as investors took profits on concerns about rising global oil prices and the country's widening fiscal deficit. Lenders such as ICICI Bank and HDFC Bank were among the big losers as market expectations for a rate cut in March was tempered by the rally in world oil prices, which could make it difficult for the central bank to ease policy.
Leading mortgage lender Housing Development Finance Corp fell as much as 6.2 percent after sources said. Citigroup Inc sold its entire stake in the company for about $1.9 billion. "A widening fiscal deficit and the worry that the rising crude oil prices may push up inflation are making investors cautious," said Arun Kejriwal, a strategist at research firm KRIS.
The benchmark, which has gained almost 17 percent since the end of December, is down about 2 percent so far this week. ICICI Bank was down more than 2 percent and HDFC Bank shed 1.1 percent. State Bank of India, the country's biggest lender, shed 1.2 percent. The stock was also weighed down after the state-run bank priced a planned share sale to the government at a discount to Thursday's close.
Mangalore Chemicals jumped as much as 16 percent after newspaper reports said UB Group Chairman Vijay Mallya had been approached by potential buyers of UB's 30.4 percent stake in the company. Shasun Pharmaceuticals rose as much as 8.4 percent after the company said its board would meet on February 27 to consider a preferential allotment of shares to private equity investors.
DB Realty, part of India's DB Group, fell 4 percent, extending losses to a third day. Abu Dhabi-based Etisalat said this week it is shutting down its Indian mobile joint venture with DB Group and has launched legal proceedings against its Indian partners. DB Realty has said the shutdown of the mobile venture would have no bearing on its financials because this was an investment by its founders in their individual capacity.