Indian shares posted their biggest percentage fall in four weeks on Monday, led by a sharp decline in Infosys after the software service exporter said US authorities were scrutinising the eligibility documents of workers in the United States. The broader sentiment was also dented by a Reuters report that Macquarie's Asia hedge fund has exited its short positions in Indian single stock futures because of uncertainty over a proposed set of tax rules that could impact foreign investors.
The country's main 30-share BSE index fell 1.6 percent to 17,096.68 points, marking its biggest daily fall since March 26. The 50-share NSE index lost 1.71 percent to 5,200.60. The Reuters report on Macquarie exiting some of its short positions and switching to futures contracts listed in Singapore Exchange to avoid potential tax issues was seen as a catalyst to some of the selling.
The falls in Indian indexes were worse than the 1.1 percent fall in the regional MSCI Asia-Pacific index that excludes Japan. Among individual decliners, Infosys dropped 4 percent after saying it was under scrutiny from the US Department of Homeland Security for likely errors in the employment eligibility documents for its foreign staff in the United States.
Infosys ending at their lowest since mid-September on Monday, continuing to be hit hard since it posted disappointing earnings on April 13. Shares in DLF dropped 4.2 percent. Bharti Airtel lost 3.7 percent and Idea lost 5.4 percent after a government regulator proposed a much higher-than-expected base price for an auction of 2G radio spectrum. The news was first reported by TV channel CNBC TV18. However, among gainers, Reliance Industries rose 0.75 percent after investors bet refining and petchem margins have hit near-trough levels after the company posted its second consecutive quarterly drop in profit late on Friday.