August 16, 2019 / 5:40 AM / a year ago

Indian shares slide as metals, IT stocks drag

Aug 16 (Reuters) - Indian shares slipped on Friday, dragged by declines in metals and IT services stocks, as the local markets caught up with a broader selloff in the previous day after fears of a recession in the United States stoked worries about global growth.

There was no resolution in sight in the trade standoff, which has disrupted global supply chains, after China on Thursday vowed to retaliate against the latest U.S. tariffs on $300 billion of Chinese goods.

The broader NSE index fell 0.44% to 10,980.60 as of 0508 GMT, while the benchmark BSE index slid 0.42% to 37,154.06. The markets, which were closed on Thursday for a national holiday, appeared set for a roughly 1% loss for the week.

All but one of the 14 NSE sectors were in the red, with the Nifty metals index leading the decline with a 1.87% fall.

On Wednesday, yields on U.S. 10-year Treasury notes slid below those on two-year notes, delivering a reliable signal of a recession and sending shudders through financial markets.

Wall Street stocks tumbled on Wednesday as investors took refuge in safe-haven assets, but gained ground on Thursday after strong U.S. retail sales data offset fears of a recession.

“Although it’s too early ... assuming a recession happens, India’s exports — mainly the IT services — will get negatively impacted,” said Kunj Bansal, chief investment officer at AcePro Advisors in Mumbai.

Bansal said Friday’s selloff was driven by short-term concerns, and that a recession in the United States could benefit Indian markets over the medium term, if Indian economic growth gained momentum.

“We could actually see foreign investors moving out from the U.S. and into markets like India.”

India’s NSE index has slipped nearly 10% since its highest level this year amid slowing economic growth, a damaging slowdown in crucial automotive industry and a proposal to raise taxes for foreign portfolio investors.

Shares in software services firms Tata Consultancy Services , India’s biggest company by market value, and Infosys Ltd fell about 1% each, dragging the the Nifty IT services index down by 1.23%.

Indiabulls Housing Finance Ltd, the top decliner on the NSE index, was down 8.5% after Moody’s on Wednesday downgraded the company’s credit rating and updated its outlook to negative.

Meanwhile, the rupee weakened to 71.47 against the dollar on Friday, hitting a fresh low since February. (Reporting by Sachin Ravikumar; Editing by Rashmi Aich)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below