Stocks fell for the third consecutive day on Thursday on profit booking arising out of valuation concerns and weak global cues.

The ongoing court battle between the Ambani brothers to settle a dispute over sharing of gas in the KG Basin and muted earning numbers for the September quarter also kept investors away, analysts said.

The benchmark Sensex shed 219.43 points (1.29 per cent) on Thursday to close at 16,789.74. In the last three days, the index shaved off 536.27 points.

National Stock Exchange’s S&P CNX Nifty lost 75 points (1.48 per cent) to end the day at 4,988.60. “It (the fall) is due to profit booking. The markets have ran up too fast in too short a period,” said Ranjit Kapadia, vice-president, institutional equities, HDFC Securities.

Real estate stocks bore the brunt of the selling with BSE Realty Index falling by 4.59 per cent – the steepest fall among all indices.

DLF, which fell 4.93 per cent to Rs 472, was the second biggest loser on the 30-share Sensex. Jaiprakash Associates (down 6.84 per cent to Rs 238.20) was the biggest loser on the index.

BSE Mid Cap Index fell 2.12 per cent with stocks such as Indian Hotels Company (down nearly 5 per cent to Rs 77.85), Indian Overseas Bank (down 4.21 per cent to Rs 127.40), IRB Infra (down 6.44 per cent to Rs 235.20) and IVRCL Infra (down 5.85 per cent to Rs 379.60), becoming the notable losers. “There were concerns on the valuation front. Both foreign and domestic institutions seem to be booking profits at present levels, especially in the last half an hour of today’s session,” said Himanshu Varia, head of institutional sales at Asit C Mehta.

The court battle between the Ambani brothers also weakened the sentiment. Mukesh Ambani-controlled Reliance Industries, the most-weighted stock on Sensex, fell 2.24 per cent to Rs 2,133.55. The earning numbers so far from India Inc were as per the expectations though results of JP Associates were disappointing. Larsen & Toubro’s second quarter profit rose 26 per cent, aided by a one-time gain and income from sources other than its main business. The shares of L&T fell to a two-month low to Rs 1,608.50.

Foreign Institutional Investors (FIIs) sold a net of nearly Rs 500 crore on Thursday, which comes on the back of Rs 511.81 crore worth net sales on Wednesday. “There is nothing wrong fundamentally with the market. The correction is good as it will help the markets into a period of consolidation,” said Kapadia of HDFC Securities.