June 9, 2020 / 10:54 AM / a month ago

Indian stocks fall 1% as banks, Reliance drag

BENGALURU (Reuters) - Indian shares closed lower on Tuesday, ending a 13% surge over the last nine sessions, as banks and heavyweight Reliance Industries weighed, with a broader rally on hopes of a quicker global economic recovery coming to a halt.

FILE PHOTO: People walk past the Bombay Stock Exchange (BSE) building in Mumbai, India, March 9, 2020. REUTERS/Francis Mascarenhas/File photo

The Nifty closed down 1.2% at 10,046.65, while the Sensex dropped 1.2% to 33956.69.

Earlier in the session, the indexes had risen more than 1% each as shopping malls and restaurants reopened this week following the world’s biggest coronavirus lockdown, even as the number of new cases climbed steeply.

“After trading in the green, we broke the important level of 10,100 on the Nifty which does make the market seem a tad weak in the short term. We could go down further to levels closer to 9,850-9,900,” said Manish Hathiramani, proprietary index trader and technical analyst at Deen Dayal Investments.

European markets slid into the red and S&P 500 futures fell 0.9% on Tuesday after recent gaining streaks.

The benchmark Nifty 50 has rallied around 35% since it hit a four-year low in mid-March, even though coronavirus cases continued to mount.

The number of new daily virus cases rose by nearly 10,000 on Tuesday, bringing the total number to 266,598, including 7,466 deaths.

“Given the fact that the psychological impact on consumers has been so severe, it will be foolhardy to believe that we will go back to pre-COVID normalcy anytime soon,” said Ajay Bodke, CEO (PMS) at Prabhudas Lilladher in Mumbai.

“The fear of a resurgence in the number of cases once the lockdown is lifted is a real worry.”

Top private-sector lender HDFC Bank Ltd and conglomerate Reliance Industries Ltd were among the top drags on the indexes, falling 2.8% and 2.1%, respectively.

The Nifty Pharma Index was the best performer for the day, closing 1.8% higher.

Reporting by Chris Thomas in Bengaluru; Editing by Arun Koyyur and Maju Samuel

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