Indian Shares End Lower

MUMBAI--Indian shares ended lower Friday as investors sold several blue chips and purchased software stocks after U.S.-based Cognizant Technology Solutions posted a better-than-expected quarterly profit and forecast strong results for 2013.

The Bombay Stock Exchange's benchmark 30-stock Sensitive Index fell 95.55 points, or 0.5%, to close at 19484.77, after trading between 19414.80 and 19648.07. The benchmark ended down 1.5% over the week.

On the National Stock Exchange, the 50-stock Nifty index fell 35.30 points, or 0.6%, to finish the day at 5903.50.

"The stock market is losing a bit of its rising momentum as investors at this juncture don't seem to be interested in buying ahead of the fiscal budget in end-February," said Vijay Kedia, director at Kedia Securities.

Mr. Kedia said the government's reform efforts since late last year had taken the benchmark index to a two-year high in January. Now investors would wait for the budget announcement as the government's estimate on economic growth has slightly hurt sentiment, he added.

The government Thursday forecast India's economic growth in the current fiscal year through March to slow to 5.0%--its weakest pace in a decade and significantly lower than last year's 6.2% growth.

As many as 22 of the Sensex's 30 component stocks closed lower. Software stocks were the prominent gainers among the remaining eight.

Among software shares, market leader Tata Consultancy Services rose 2.6% to 1423.25 rupees, while Wipro gained 1.6% to 411.45 rupees.

Cognizant provides information technology, consulting, and business process outsourcing services, and its performance is considered as an indicator of the demand situation in the outsourcing industry.

Citigroup said Cognizant's 2013 revenue-growth guidance of "at least 17%" suggests Indian companies should be able to deliver 12%-14% revenue growth. Also, "signs of a pickup [in the software outsourcing industry] driven by pent-up demand are visible with deal pipelines building up," it said in a note.

On bargain buying, Larsen & Toubro rose 0.9% to close at 1509.35 rupees, while HDFC Bank gained 1.2% to 649.65 rupees.

However, the prospect of continuing slow domestic growth led to selling in major bank and energy stocks.

ICICI Bank closed 1.3% lower at 1130.10 rupees, while State Bank of India fell 1.8% to 2286.40 rupees.

Among energy majors, state-owned Oil & Natural Gas fell 2.0% to 313.45 rupees and Reliance Industries ended 0.8% lower at 864.20 rupees.

NTPC closed 0.1% down at 148.00 rupees on profit-taking. Thursday, the government raised $2.1 billion by selling a 9.5% stake in the power producer.