Mumbai, Jul 16 - Indian shares dropped for the fourth straight today with Sensex losing 110.39 points to end at 17.103.31 -- its lowest closing since June 28 -- as monsoon worries and rising food prices in June dashed investor hopes of a rate cut by RBI later this month.
The BSE benchmark index, which had lost 405 points in last three days, opened higher on positive Asian cues but slided to end the day at its lowest level, losing 0.64 per cent. The 50-share NSE Nifty fell by 30 points to 5,197.25.
While easing prices of manufactured goods pulled down the headline inflation marginally to 7.25 per cent but food inflation rose to 10.81 per cent in June. "RBI may not ease interest rate going by the number released today," Crisil Chief Economist D K Joshi said.
The mood was further exacerbated by comments from Agriculture Minister Sharad Pawar who said farmers face a challenge to maintain the same performance as compared to last two years as monsoon plays "hide and seek" this year.
In the 30-share Sensex, 20 stocks including Tata Steel, Jindal Steel, TCS and Infosys closed with losses while ten scrips led by Bharti, Dr Reddy's and Maruti closed higher.
Selling pressure was across the metal shares as worries over lower Chinese demand aggravated, brokers said. IT shares fell after Goldman Sachs reportedly slashed its IT spending forecast for 2012 to 3 per cent.
The rupee gave up most of its initial gains and was last trading at 55.25 compared to 54.8 levels seen intra-day. "The bounceback in USD/Rupee rates also didn't auger well for equity markets which succumbed to selling pressure," said Milan Bavishi, Head Research, Inventure Growth & Securities.
With the mood being negative, pharma shares recorded a strong performance with Dr Reddy, Cipla, Sun Pharma and Ranbaxy all ending with gains. PTI