Indian shares sag on US election impact

Indian share prices fell 0.64 percent on Wednesday on fears that a resurgence by the Democrats in US mid-term elections could mean less market-friendly economic policies, dealers said.
They said speculation about the impact of renewed Democratic electoral strength and a sharp run-up in Indian equities in recent months led to funds and investors booking profits. The 30-share benchmark Sensex index fell 84.15 points to 13,072.51.
"The markets were nervous over the US elections impact for India and the Asian region. Valuations appear stretched and stocks were overbought after strong quarterly corporate earnings," said Nikhil Thacker, head of research at brokerage UTI Securities.
The Democrats seized control of the US House of Representatives and made gains in the Senate, riding a wave of public anger over the war in Iraq. "The markets needed a trigger for the sell-off. We see resistance and nervousness in the near-term," he said.