Indian shares snap 5-week gaining streak; Infosys slumps


* BSE ends 0.69 pct down; NSE falls 0.56 pct

* Caution sets in ahead of inflation data

* Market may remain volatile: Analyst

By Abhishek Vishnoi

MUMBAI, Oct 12 (Reuters) - Indian shares snapped a five-weekstreak of gains on Friday as bellwether Infosys Ltd

slumped after disappointing investors with its growth outlook,with caution also setting in ahead of key inflation data nextweek.

Worries that India would post high inflation data on Mondayand erode prospects of interest rates cut from the central bankat the end of the month hit financial stocks such as ICICI Bank

.The wholesale price index

likely rose to 7.70percent in September from a year earlier, compared with 7.55percent in August and far above the central bank's comfort levelof 4-5 percent, a Reuters polled showed.

Analysts say Indian shares are expected to remain volatilenext week as a host of key blue chip stocks report earnings,starting Reliance Industries

on Monday.

"The bias remains on upside, but market may remain volatilein the short term due to subdued expectations fromsecond-quarter earnings," said Sudip Bandyopadhyay, managingdirector at Destimoney Securities Pvt Ltd.

Bandyopadhyay said a rate cut is overdue as the inflation isexpected to remain high.

India's BSE index

fell 0.69 percent, or 129.57points, to 18,675.18 on Friday. The index, also known as theSensex, fell 1.39 percent for the week.

The 50-share NSE indexfell 0.56 percent, or 32points, to 5,676.05 points and lost 1.23 percent for the week.

Stocks were not impressed by the modest improvement inIndia's industrial output for August, while inflation slowed,improving the case for a cut in interest rates that bothbusinessmen and politicians have been pleading for.

Shares in Infosys Ltd

, India's second-rankedsoftware services provider, fell 5.65 percent after itdisappointed investors with weaker-than-expected margins andtook a conservative view on its full-year earnings, sending itsshares down the most in six months.

Infosys disappointing outlook also sapped confidence in someof the other IT stocks such as Wipro

and Tech Mahindra

. Wipro ended down 1.7 percent while Tech Mahindra fell1.8 percent.

Financial stocks such as ICICI Bank also fell on fears ofhigh inflation data on Monday. ICICI ended down 1.25 percent.

Delhi based property developer, Unitech


fell 3.3 percent on profit-taking after Thursday's 17.2 percentgain, even as Citigroup upgraded the stock to 'buy' from'neutral' and raised its target price to 38 rupees from 27rupees.

Citigroup upgraded Unitech after the company dissolved atelecom joint venture with partner Telenor

, reaching asettlement on their longstanding dispute.

Kitchen appliances maker, TTK Prestige

fell 10.1percent after its second-quarter net profit fell 10.17 percentto 302.8 million rupees from 337.1 million rupees.

However, among gainers, Jet Airways

rose 2.6percent, while SpiceJet

ended up 0.14 percent afterBank of America-Merrill Lynch reiterated its 'buy' ratings onJet Airways and SpiceJet.

Indian airlines in the near-term will benefit from astronger rupee

, the temporary shutdown of Kingfisher

, capacity discipline, and improvements in utilisationand yield.

Maruti Suzuki

shares gained 0.2 percent afterDeutsche Bank upgraded it to "buy" from "hold" and raised itstarget price to 1,600 rupees from 1,100 rupees. The bank seesearlier concerns on high levels of inflation, interest rates andwidening of the gasoline-diesel price difference easing.

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* For closing rates of Indian ADRs

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(Additional Reporting by Manoj Dharra; Editing by Rafael Namand Anand Basu)

((abhishek.vishnoi@thomsonreuters.com)(+91 22 61807225)(ReutersMessenger)(abhishek.vishnoi.reuters.com@reuters.)(net))