Sensex falls 100 pts, Nifty slips below 8550; Infosys tanks 10%

Moneycontrol Bureau10:35 am Market Update: Equity benchmarks extended selling pressure after Infosys' quarterly earnings. The Sensex fell 102.39 points to 27839.72 and the Nifty slipped 26 points to 8539.The market breadth was negative as about 1196 shares declined against 856 advancing shares on BSE. 10:25 am Earnings: IT major Infosys missed analysts expectations on topline front while bottomline and operational numbers matched estimates for the quarter ended June 2016. Profit in Q1 declined 4.5 percent sequentially to Rs 3,436 crore while revenue increased 1.4 percent to Rs 16,782 crore.

Revenue in dollar terms grew by 2.2 percent to USD 2,501 million and constant currency dollar revenue growth at 1.7 percent compared with preceding quarter.

Major disappointing news for the stock, which lost 10 percent intraday, was that the country's second largest IT services exporter lowered its constant currency revenue growth guidance to 10.5-12 percent from 11.5-13.5 percent. This is slightly similar to NASSCOM's industry guidance of 10-12 percent.

Profit was estimated at Rs 3,447 crore (down 4.2 percent) on revenue of Rs 17,089 crore (up 3.25 percent) for the quarter. Dollar revenue was expected at USD 2,547 million, according to average of estimates of analysts polled by CNBC-TV18.10:15 am FII View: JP Morgan has an overweight stance on India with expectations of double digit returns as the index moves towards 9,000 level. Strong earnings are expected in 2017, he says.

"I would rather own domestically focused business than owing software services company," Mowat says adding that IT firms will get move affected by global events like Brexit.

On the Goods and Services Tax (GST), expected to see light in upcoming Monsoon session, Mowat says that expectations are already low. If the GST doesn’t go through, negative impact will be low.Also read - Citi sees Sensex at 28,800; lists 5 largecaps, midcaps to buy10:00 am Market Check

The market continued to consolidate for the third consecutive session, though the Sensex reclaimed 28000 level. The broader markets outperformed benchmarks with the BSE Midcap index rising half a percent.

The 30-share BSE Sensex was up 22.09 points at 27964.20 and the 50-share NSE Nifty advanced 8.70 points to 8573.70.

Adani Ports topped buying list on Sensex, up nearly 3 percent followed by ITC, Infosys, HUL, M&M and Bharti Airtel while HDFC, TCS, HDFC Bank, L&T and ICICI Bank were losers. NTPC lost nearly 3 percent.

Asia markets traded higher, following another record close in US stocks, and as investors digested a data deluge from China. Japan's Nikkei gained 1 percent and Hong Kong's Hang Seng was up 0.6 percent.