MARKET EYE-Indian shares extend falls; blue chips hit

* The BSE index

fall 1 percent, while the 50-share NSE index declines 1.1 percent, heading for a second day of losses. * Investors book profits after the BSE index rose to 17-month highs on Friday, while the NSE hit its highest in nearly 18-months. * Reliance Industries

falls 4 percent after Morgan Stanley cuts its rating to 'underweight' from 'equal-weight', citing expectations for weaker refining margins and valuation concerns among other factors.

* DLF Ltd

drops 7.2 percent after anti-corruption activists accused the company of improper dealings with the son-in-law of the country's ruling party chief Sonia Gandhi. Both the property developer and the family member deny the accusations.

* Infosys

falls 1.3 percent ahead of its Q2 results expected on Friday, with investors worried the software service exporter will have to cut its guidance to reflect the stronger rupee

and a potential weakening in global demand.