The BSE benchmark Sensex fell on Friday after militant attacks on the financial capital of Mumbai killed at least 121 people and shut down the market for a day, rattling investors.
The attacks by armed Islamic militants at several places, including two luxury hotels, killed at least 121 people and shut down financial markets on Thursday. Fighting was continuing on Friday morning, more than 36 hours after it started.
Shares in Indian Hotels fell 13.5 per cent to 41.90 rupees and EIH was down 4.6 per cent at 88.60 rupees after their main hotels -- Taj Mahal Hotel and Oberoi-Trident were damaged by the attacks.
By 12 p.m., the 30-share BSE index was down 0.64 per cent, or 57.54 points, at 8,969.18, with 20 stocks losing ground. It opened down 1.5 per cent and then rose as much as 0.6 per cent.
Traders said short covering ahead of the expiry of monthly derivatives and better-than-expected economic growth in the September quarter helped the market to pull back, but the outlook for the near term was weighed down by greater political risks.
"A knee-jerk reaction to the attacks was expected and it has happened and now I think the markets are behaving normally," said Arun Kejriwal, strategist at research firm KRIS. "People here don't like this to hammer down the markets."
Volume was below normal at 66 million shares in the broader market, where losers led gainers two to one.
Outsourcers such as Infosys Technologies rose 3.2 per cent to 1,225 rupees and Tata Consultancy Services was up 4.2 per cent at 549 rupees, as investors hunted for bargains in battered stocks, traders said.
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