ndian shares gave up strong early gains and fell 2.5 percent on Friday, after sharply lower advance tax payments by companies pointed toward dismal quarterly earnings next month. Outsourcers and financials led the losses as investors saw them as more vulnerable to an economic slowdown, traders said. Reliance Petroleum Ltd, a unit of top listed firm Reliance Industries, bucked the trend and rallied 6.3 percent to 84.70 rupees as its $6 billion, 580,000 barrels per day refinery started processing crude on Thursday. . The government said on Friday advance taxes paid by companies for the December quarter had fallen 22 percent from the same period a year ago, indicating a big drop in expected earnings. 'On such a day, any bad news can ruin the way the market progresses. There was just no participation at all,' said K.K. Mital, head of portfolio managed services at Globe Capital. The 30-share BSE index fell 2.51 percent, or 239.80 points, to 9,328.92, its lowest close since Dec. 8. The index, which had climbed 1.4 percent early, lost 7.6 percent on the week, its first drop in three and the worst weekly fall in two months. All but five of the index components fell. In the broader market, losers outran gainers in the ratio of almost 2 to 1 on moderate volume of 263.6 million shares. Traders said the outlook for next week would depend upon how quickly the government announces another economic stimulus package and when the central bank would cut rates. Annual inflation fell to a nine-month low of 6.61 percent in mid-December and analysts saw it diving to 2 percent by March freeing the central bank to cut interest rates deeply. Foreign funds that have sold a net of $13.3 billion of shares so far in 2008 were largely absent due to the holiday season overseas, while there was sporadic selling by some, traders said. Outsourcers fell on concerns a weak global economy will crimp orders. IT bellwether Infosys Technologies dropped 5.3 percent to 1,109.55 rupees, its sharpest daily fall in more than a month and top outsourcer Tata Consultancy Services eased 1.2 percent to 472.10 rupees. ICICI Bank, the No.2 lender, led banks down, falling 5.2 percent to 417.95 rupees, its lowest close in nearly two weeks. Top lender State Bank of India shed 3.3 percent to 1,244.25 rupees. Satyam Computer Services rose 0.4 percent to 135.50 rupees as investors speculated the board of the No. 4 outsourcer would set a higher price at a share buyback it is scheduled to consider on Monday. The broader 50-share index fell 2.04 percent to 2,857.25. STOCKS THAT MOVED * Top listed real estate firm DLF fell nearly 6 percent to 276.40 rupees, its lowest close since Dec. 17 on concerns a slowing economy and falling corporate profits would keep away buyers. * Cholamandalam DBS Finance Ltd, a joint venture between India's diversified Murugappa group and Singapore DBS Group, rose 9.9 percent to 40.95 rupees after it said its founders would subscribe to 3 billion rupees worth of convertible preference shares.

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