Mumbai: Shares fell on Thursday on concerns over differences in the UPA coalition with BSE Sensex dropping by 120 points, snapping a three-day upsurge.
    
Banking, capital goods, realty and power stocks dropped the most also on reports that the Reserve Bank plans to tighten norms for loan restructuring of corporates. Under the impact of slowdown, several companies are knocking the doors of banks seeking recast of their debt burden.
    
The BSE benchmark index fell by 120.41 points, or 0.70 percent to 17,158.44. Similarly, the 50-share National Stock Exchange index Nifty fell by 37.60 points to 5,205.10.
    
Brokers said investors became cautious following differences between the Congress and Agriculture Minister Sharad Pawar-led NCP which has raised questions over functioning of the government and the UPA coalition.
    
Markets had gained 176 points in the last three days on heightened expectations of speedier reforms after Presidential polls which were concluded on Thursday. The sudden political developments, however, made investors jittery, analysts said. They added that it is only through reforms the market can be revived.
    
Traders said the mood was further hit after the Reserve Bank Working Group gave recommendations about prudential guidelines on restructuring of advances by banks and financial institutions. Bank stocks including ICICI Bank, HDFC Bank, HDFC and SBI ended lower.
    
In the 30-share Sensex, 24 stocks led by Dr Reddy's, BHEL, Sterlite and Hero MotoCorp fell while six scrips, including Bajaj Auto and TCS closed higher.
    
Maruti Suzuki, which tanked 9 percent on Thursday, held on to slim gains on Friday even as the Manesar plant remained shut following violent incident on Wednesday.
    
However, RIL fell by nearly 0.9 percent ahead of expectations of weak quarterly earnings later on Friday while tech major Infosys slid by 1.13 percent after gaining on Thursday.

Dealers said a mixed trend in global markets offered no support to Indian market as Asian stocks ended narrowly mixed while European markets too offered no major direction in their afternoon deals.
    
In Asia, key indices from China, Japan, Singapore finished lower while those from Hong Kong and Taiwan closed higher.
Among European indices, France's CAC was trading down by 0.77 percent, Germany's DAX lost 0.34 percent while the UK's FTSE was lower by 0.52 percent.
    
Back home, major losers from the Sensex pack included Dr Reddy's Lab that fell by 2.68 per cent, followed by BHEL (2.47 pc), Cipla (1.67 pc), ICICI Bank (1.58 pc), Wipro (1.47 pc), HDFC (1.38 pc), L&T (1.22 pc), Tata Power (1.14 pc), Infosys (1.13 pc), SBI (1.08 pc) and HDFC Bank (1.04 pc).
    
However, Bajaj Auto shot up by 2.67 percent, followed by Maruti Suzuki (2.43 pc) and TCS (1.86 pc).
    
"FII flows have stayed positive this month on hope that the UPA will initiate a few key reforms before the start of the monsoon session of parliament on August 8," said Amar Ambani, Head of Research, IIFL.
    
Among the sectoral indices, the BSE-Bankex fell by 1.28 percent, the BSE-Capital Goods (1.14 pc), the BSE-Realty (0.99 pc), the BSE-Power (0.95 pc) and BSE-Oil&Gas (0.71 pc).
    
The total market breadth turned negative as 1,659 shares finished with losses while 1,165 shares ended with gains.
    
The total turnover declined further to Rs 1,727.85 crore from Rs 1,926.30 crore on Thursday.
    
Foreign institutional investors (FIIs) bought shares worth a net Rs 125.78 crore on Thursday as per provisional data released by the stock exchanges.

(Agencies)

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