Indian stocks close nearly 1% lower as financials slump; The ICICI Bank weighs
BENGALURU (Reuters) – Indian stocks gave up initial gains to end sharply lower on Friday, as high-flying financial stocks sold off amid a broader rise in bond yields in the United States and Europe.
The blue chip NSE Nifty 50 index lost 0.95% to close at 15,030.95, while the benchmark S&P BSE Sensex fell 0.95% to close at 50,792.08. Despite today’s losses, both indices posted their second consecutive weekly gain.
The Nifty and Sensex gained up to 1.06% each earlier in the day but fell into the red, in line with global markets including the previous rally when signing a US stimulus bill was halted by rising bond yields and inflationary concerns. [MKTS/GLOB]
“At these high levels, (domestic) indices are exposed to all triggers globally,” said Siddhartha Khemka, retail research manager at Motilal Oswal Financial Services in Mumbai.
High commodity and crude oil prices remain a concern domestically, Khemka added.
Investors await retail inflation data for February later today. A Reuters poll showed retail inflation likely increased but remained within the central bank’s target range.
In Mumbai, the Nifty Bank index fell 1.23%. ICICI Bank Ltd was among the main drag on the Nifty 50, losing 2%.
“Banks would have the biggest impact if bond yields increased … they are also the biggest segment of the market in terms of weight, holdings of foreign institutional investors,” Khemka said.
Tata Power Co Ltd finished up 5.5%, after news channel CNBC-TV18 reported that the power generation and transmission company was studying a deal with Tesla Inc to set up charging infrastructure.
IDBI Bank Ltd closed up 9.8%. India’s central bank said on Wednesday it would remove the public lender from its list of corrective measures.
Report by Anuron Kumar Mitra in Bengaluru; Editing by Krishna Chandra Eluri