BENGALURU (Reuters) - Indian shares snapped an eight-day winning streak on Thursday as investors sold off banking and financial stocks, despite Finance Minister Nirmala Sitharaman announcing a new set of stimulus measures and sounding optimistic on the state of the country’s economy.
The NSE Nifty 50 index closed 0.46% lower at 12,690.8 and the S&P BSE Sensex fell 0.54% to 43,357.19.
Sitharaman said the economy was seeing a strong recovery taking root, before announcing a scheme to incentivise the creation of new jobs and a credit guarantee support for stressed sectors, among other measures.
However, analysts said that while the stimulus measures did provide some support to the real estate sector, there was not much meat in Sitharaman’s announcement to help markets continue their rally.
“Investors were not expecting much from this stimulus announcement other than some incremental measures for specific sectors,” said Samrat Dasgupta, chief executive at Esquire Capital Investment Advisors.
“There was nothing that would move the needle for India Inc as a whole.”
The Nifty’s banking index snapped an eight-session rally that saw it gain over 20% as of Wednesday’s close, compared to about 9% gain in the Nifty during the same period. The Nifty financials index fell about 1%
“The markets have run-up too much and its time they took a pause,” Dasgupta said.
India’s top lender, State Bank of India, slid 3.2% and was the session’s top drag on the Nifty. Kotak Mahindra Bank fell 2.9%.
Miner Coal India, which reported a lower September-quarter profit on Wednesday, declined 3% on Thursday.
Grasim Industries was the top gainer, rising nearly 3%.
India will report its retail inflation data for October later in the day. A Reuters poll showed the number is likely to stay above 7% for a second straight month, lowering the chances of further interest rate cuts by the central bank.
Reporting by Derek Francis in Bengaluru; Editing by Vinay Dwivedi
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