Mumbai: The BSE Sensex edged lower on Wednesday, after touching its highest in more than a month, as exporters such as Infosys fell on worries strength in the rupee after inflation data may persist and hurt revenues.
India`s consumer price inflation unexpectedly slowed to a three-month low in March, while wholesale prices declined at a faster-than-expected annual rate, which could encourage the central bank to deliver another off-cycle interest rate cut to boost economic recovery.
Reliance Industries also fell ahead of its Jan-March results due on Friday, which will set the tone for quarterly earnings season expected to be bogged down by slower-than-expected recovery in economy.
Falls also tracked weak Asian markets as relief China had matched its own growth target was soured by poor readings on consumer demand and industrial activity, underlining the need for more policy action by Beijing.
"RBI`s purchase of U.S. dollar last few quarters shows that support to USD. So IT stocks fall on rupee strength should be limited," said G. Chokkalingam, founder of Equinomics, a Mumbai-based research and fund advisory firm.
Earnings are expected to show only marginal improvement in the January-March quarter, he said.
The Sensex fell 0.2 percent after touching its highest intraday level since March 12, while the broader Nifty lost 0.25 percent.
Profit-taking also weighed after the 50-share NSE index rose for the last seven consecutive sessions.
Exporters led the declines. Infosys lost 1.5 percent, Tata Consultancy Services fell 0.8 percent and Wipro was down 1.8 percent.
Among drug exporters, Sun Pharmaceutical Industries lost 1.8 percent while Cipla was down 1.8 percent
In other blue chip stocks, Tata Motors lost 2.1 percent while Coal India fell 1.6 percent.
