Mumbai/New Delhi, June 20
The BSE Sensex fell more than 2 percent on Thursday, the most in a day in nearly 21 months as blue chips such as Reliance Industries slumped after the U.S. Federal Reserve signalled a tapering of its monetary stimulus, stoking fears of portfolio outflows.

Emerging markets, many of which have been primed by easy Fed money, saw some of the biggest selling as investors rushed to the exits. MSCI's benchmark index for emerging equities slumped by more than 3 percent.

The rupee hit an all-time low against the U.S. dollar, prompting Reserve Bank of India intervention and highlighting the country's dependence on foreign capital inflows to fund its current account deficit.

FIIs have been sellers in index futures for the past 13 out of 14 sessions, totalling Rs 88.46 billion. They have also sold cash shares for seven straight sessions, totalling Rs 39.41 billion as per exchange and regulatory data.

"The reaction to Fed is exaggerated, outflows may happen but with the rupee so cheap it may be time for new money to also come in," said Paras Adenwala, managing director and principal portfolio manager at Capital Portfolio Advisors.

Sentiment was also fragile after China's factory activity weakened to a nine-month low in June as demand faltered, a preliminary survey showed, heightening risks that a second quarter slowdown could be sharper than expected.

The BSE Sensex slumped 2.74%, or 526.41 points, to end at 18,719.29, to mark its lowest close since April 15.

The broader Nifty fell 2.86%, or 166.35 points, to end at 5,655.90. It earlier fell as much as 3.03%.

Bluechip stocks such as Reliance Industries fell 4.05%, while cigarette-maker ITC ended 2.18% lower.

Shares of large-cap private banks also fell as traders fear that the high foreign holding in these stocks makes them more vulnerable to a sell-off after the Fed decision. ICICI Bank, with 37.94% FII holding, fell 3.7%, while HDFC Bank, where FIIs hold 34.07% of total shares, slumped 4.3%.

Traders worry that an end to the U.S. monetary stimulus could lead to portfolio outflows, pushing the rupee lower and, in turn, delaying any rate cuts from the central bank.

Among other interest-rate sensitive stocks, DLF slumped 7.2%, while Unitech dropped 5.4%.

Automakers also fell, with Maruti Suzuki India down 1.2% and Mahindra & Mahindra ending 3.8% lower.

Among the gainers, Apollo Tyres rose 0.9 per cent after declining 33.7 per cent in five sessions. — Reuters

New Delhi/London, June 20
Both the precious metals — gold and silver — tumbled in Delhi on Thursday on heavy selloff by stockists, triggered by a weak trend in overseas markets.

While gold fell by Rs 400 to Rs 28,000 per ten grams, silver plunged by Rs 1,500 to Rs 43,100 per kilogram on poor offtake.

Gold prices tumbled to their lowest in more than 2-1/2 years on Thursday and silver fell more than 6% after the US Federal Reserve gave its most explicit signal yet that it plans to bring the era of easy money to an end.

"For western investors, there's certainly less incentive to hold gold at the moment," Mitsui Precious Metals analyst David Jollie said.

However, marketmen said, weakening rupee, which made imports costlier, cushioned the fall to some extent.

Meanwhile, rupee after touching life-time low of 60 against the dollar, was trading at 59.77, still down by 107 paise over its yesterday's close of 58.70.

Gold in London, which normally sets price trend on the domestic front, dropped by 3.4% to US $1,304.75 an ounce, its lowest since September 30, 2010. Silver fell by 6.2% to $20.08 an ounce, the cheapest since Sept 14, 2010.

On the domestic front, gold of 99.9 and 99.5 per cent purity plummeted by Rs 400 each to Rs 28,000 and Rs 27,800 per ten grams, respectively.

The yellow metal had lost Rs 80 yesterday. Sovereign followed suit and declined by Rs 200 to Rs 24,200 per piece of eight gram.

In a similar fashion, silver ready dropped by a whopping Rs 1,500 to Rs 43,100 per kg and weekly-based delivery by Rs 1,280 to Rs 42,450 per kg. Silver coins also nosedived by Rs 2,000 to Rs 78,000 for buying and Rs 79,000 for selling of 100 pieces. — PTI/Reuters

New York City, June 20
Five of the six most expensive office areas in the world are in Asia, as demand by global companies to locate there outstripped the supply, according to a semiannual report released on Thursday by real estate services company CBRE Inc.

For the third consecutive time, Hong Kong's Central business district had the highest overall occupancy cost, which includes local taxes and service charges. Hong Kong's Central averaged US $235.23 per square foot annually at the end of March, leading London's West End at $222.58. Beijing's Finance Street followed at $195.07 per square foot with Beijing's central business district right behind at $187.06.

At No. 5 New Delhi's Connaught Place's occupancy cost was $178.96 per square foot with Hong Kong's West Kowloon area at $173.90, according to the report that covers 127 markets around the globe.

"Demand is coming from a lot of MNCs who want to place a stake into these developing economies," said Raymond Torto, CBRE's global chief economist. "When they look around some of these cities, they want to be in the best locations because there's not a lot of good infrastructure. You want to be close to other businesses. You want to be close to transportation. And you want to be in a quality property."

Meanwhile, supply is muted by either height restrictions or ownership in which even in the best buildings separate floors can be owned by different landlords. That restricts opportunities to upgrade a building and can limit the availability of contiguous space, he said.

At No. 7 on the list is Moscow, followed by Tokyo's Marunouchi/Otemachi district and London's Central City, with Midtown Manhattan making 10th place at $120.65 per square foot.

Jakarta saw the biggest increase, with occupancy costs jumping 38.9% compared with a year earlier. Two of Houston's office areas also made their way into the top five areas where occupancy costs increased the most. In suburban Houston, occupancy costs jumped 21.2% to No. 2. Downtown occupancy costs rose 14.9%, fourth behind downtown Boston.

Globally, occupancy costs rose by 1.4%. — Reuters

Seattle, Wash., June 20
Microsoft Corp recently talked with Nokia about buying the Finnish phone maker's devices unit, but the discussions faltered and are not likely to be revived, the Wall Street Journal reported Wednesday in its online edition.

The Journal reported that "advanced discussions" on a deal happened as recently as this month, according to unnamed sources it said were familiar with the matter. Microsoft rejected a deal because of price and Nokia's loss of market share to rising Asian competitors, the report said.

Representatives of both companies declined comment. Nokia's smartphones exclusively use Microsoft Windows Phone software, under a deal the two companies struck two years ago.

Nokia Oyj rose as much as 4.1% in Helsinki trading after the Journal reported on the talks.

Nokia, once the dominant company in the mobile-phone industry, is struggling to win back market share from Apple Inc. and Samsung Electronics Co. with its Lumia smartphones. “With Nokia working to revive its profitability and Microsoft seeking to bolster its wireless business, the deal would be mutually beneficial,” said Mikko Ervasti, an analyst at Evli Bank Oyj.

“It does makes sense,” said Ervasti, who is based in Helsinki and recommends buying Nokia shares. “All options have to be on the table, but at the moment it’s of utmost importance that operations are not distracted. This summer is Nokia’s chance to show Lumia is here to stay,” the report said.

Frank Shaw, a spokesman for Microsoft, and James Etheridge, a spokesman at Nokia, declined to comment, the report added.

Earlier this week, Nokia’s shares jumped after a report that Chinese telecommunications business Huawei Technologies Co. Ltd may be interested in acquiring the entire company.

CLOSE PARTNERSHIP: Nokia and Microsoft already have a close partnership, with the Espoo, Finland-based company relying on the US software maker for operating-system technology. Nokia introduced the Lumia 925 last month, which runs on Microsoft’s Windows 8.

“Still, Microsoft wouldn’t need to buy Nokia to enter the mobile-device business,” said Hannu Rauhala, an analyst at Pohjola Bank Oyj in Helsinki with an accumulate rating on Nokia, the Journal said.

“I don’t understand the reasons behind the deal,” Rauhala said. “If Microsoft desires to make its own phones, there would be plenty of manufacturing capacity available on the market. Microsoft itself has expertise on operating systems and hardware expertise could be obtained from the market”, the Wall Street Journal said. — Reuters, other agencies

New Delhi, June 20
Come July, mobile phone prices are expected to be dearer by up to 10% due to the steep depreciation in the value of the rupee against the US dollar.

"Brands dependent on import will have to take price increase of about 10% due to decline in the rupee value. Companies making mobile phone in India will be impacted to lesser extent but they will also have to increase price by 5% to 6%," Indian Cellular Association's (ICA) national president, Pankaj Mohindroo told PTI. He said "a price hike in products will be visible from July."

The rupee hit a life time low of 59.93 to a dollar in early trade today before closing at 59.57.

"We have no other option but to increase the price. In the next couple of days, we will be increasing the handset prices by around 10%," Lava International co-founder and director S.N. Rai said.

Though Nokia did not offer any comment, Samsung said that it has not made any change in the price of handsets yet and is "holding on to the price lines for the moment."

Multinational brand Lenovo said it may raise its mobile handsets prices in the range of 5% to 8%.

Retailers also admitted that the price of computer and other electronic goods, including mobile phones, will go up soon. — PTI