Indian shares fell on Thursday, dragged by information
technology stocks, as foreign selling continued amid persistent
fears of a prolonged high-interest regime.
The Nifty 50 index fell 0.60% to 17,346.35, while the S&P BSE Sensex edged 0.64% lower to 59,031.16 as of 10:16 a.m. IST. Ten of the 13 major sectoral indexes fell with the high weightage information technology shedding 1.5%. All the ten constituents of IT index logged losses, led by Tata Consultancy Services , Infosys and Tech Mahindra , which earn a significant share of their revenue from the U.S.
The slide in IT stocks comes after official data showed prices of raw materials rose in the world's largest economy in February, implying inflation remained at elevated levels and heightening worries about interest rates staying high for longer.
IT companies are likely to witness some cutbacks in the next few months as customers rationalise their tech spending, said two analysts, adding that the long term outlook remained strong for the sector.
Meanwhile, foreign institutional investors (FII) offloaded a
net 4.25 billion rupees worth of equities on Wednesday.
Foreign portfolio investors (FPIs) have sold a net 387.89
billion rupees ($4.70 billion) worth of Indian equities thus
far into the year.
"A liquidity dry-up due to foreign selling, continuing
weakness in earnings and lack of retail support will continue to
pile the pressure on markets for the next few months," said
Avinash Gorakshakar, head of research at Profitmart Securities.
Among individual stocks, Rail Vikas Nigam climbed
over 9% after emerging as the lowest bidder to make and maintain
200 Vande Bharat trainsets. The cost per set is 1.20 billion
rupees. Bajaj Finserv rose nearly 3% on getting a regulatory
license to start a mutual fund business. Macrotech Developers gained nearly 5% after the company
estimated its pre-sales to grow at an average annual growth rate
of 20% and reach 200 bln rupees by FY2026.
($1 = 82.4900 Indian rupees)
(Reporting by Bharath Rajeswaran in Bengaluru;Editing by Dhanya
Ann Thoppil and Nivedita Bhattacharjee)
