Rally In Pharma Stocks Fails To Lift Sensex, Nifty

Indian equity benchmarks declined for third straight session and the rupee dropped to a 10-week low on concerns that the nation’s fiscal deficit will widen after the government said it was considering measures to boost growth.

The S&P BSE Sensex was little changed at 32,370 while the NSE Nifty 50 Index slipped 0.2 percent to 10,122.

Sixteen out of 19 sector gauges compiled by BSE ended lower led by the S&P BSE Realty Index's 2.3 percent drop. On the flipside, the S&P BSE Healthcare Index was the top sectoral gainer, up 2.7 percent.

Pharma shares can go up 15-20 percent in the short term, says independent market expert Mehraboon Irani.

For the longer term Irani continues to hold his negative outlook on the sector citing valuations not justifying earnings outlook. Apart from regulatory concerns, he said the pricing power enjoyed by the drugmakers is also over.

• Torrent Pharma: The Ahmedabad-based drugmaker jumped as much as 6 percent, the most in over a month, to Rs 1,333. trading volume was 6.9 times its 20-day average.
• Ipca Labs: The Mumbai-based pharma company rose as much as 19 percent, the most in over five years, to Rs 586. Trading volume was 5.1 time its 20-day average.
• Reliance Communications: The Mumbai-based telecom service provider climbed as much as 9 percent, the most in over a month, to Rs 21.5. Trading volume was 4.8 time its 20-day average.
• Alembic Pharma: The Vadodara-based drugmaker advanced 4.6 percent, the most in over two months, to Rs 503. Trading volume was 3.8 times its 20-day average.

Shares of the Bangalore-based communication equipment maker jumped as much as 20 percent, the most since April 24, to Rs 122, also its all-time high.

ITI has emerged as the lowest bidder for Rs 7,000 crore "ASCON Phase IV Project" by the ministry of defence, company said in a stock exchange filing.

• The Indian rupee fell to 64.78 against the U.S. dollar, its lowest level since July 6.
• Yield on 6.79 percent government bonds due May 2027 jumped 7 basis points to 6.65 percent; a close at this level will be highest since May 31.