Shares end 3-day rally as IT stocks fall
Sentiment was also weaker globally as Meta stocks fell 20% following its forecast
BENGALURU: Shares fell more than 1% on Thursday, snapping three sessions of gains, as losses in financial and information technology stocks eclipsed gains in automakers.
The blue-chip NSE Nifty 50 index dropped 1.24% to 17,560.2 and the S&P BSE Sensex slid 1.29% to 58,788.02.
Both the indexes added 4% in the past three sessions, with a rally sparked by the country’s high-spending federal budget accounting for most of those gains.
Sentiment was also weaker globally on Thursday after a disappointing forecast from Facebook owner Meta Platforms sent its stock 20% lower and sparked a 2% drop in Nasdaq futures.
In Mumbai, the Nifty IT index slid 2.1% after gaining nearly 7% over the last four sessions, with IT giant Infosys falling 2.7%.
The Nifty Financial Services index fell 1.4% as top mortgage lender Housing Development Finance Corp dropped 3.3% in its worst day since late November.
Mahindra And Mahindra Financial Services tumbled 5.3%, its biggest fall since mid-November, as analysts flagged concerns about its asset quality.
Tyre makers JK Tyre and Birla
Tyres dropped 2.3% and 2.9%, respectively, after India’s antitrust agency fined them for price cartelisation.
Jeweller and watch maker Titan Company rose as much as 1.7% after posting strong quarterly results, but pared some gains to settle only 0.4% higher.
The Nifty Auto index advanced 0.4%, led by strong gains in two-wheeler makers TVS Motor and Hero MotoCorp.
Defence equipment maker Bharat Dynamics surged 3.3% after signing a $419 million contract to supply anti-tank missiles to the Indian army.
Conglomerate ITC rose 1% ahead of its quarterly results.
Shares slipped in Europe on Thursday after a mixed session in Asia, with markets in China still closed for Lunar New Year holidays.
U.S. futures also were lower as investors watched for updates on monetary policy from the Bank of England and European Central Bank, mindful of the Federal Reserve’s plans to begin raising interest rates in March.
The Bank of England was expected to raise interest rates again Thursday, putting the United Kingdom far ahead of the rest of Europe and the U.S. in moving to tame surging inflation that is squeezing consumers and businesses.
In contrast, the European Central Bank doesn’t plan to raise rates until 2023 despite record inflation, blaming it on temporary factors. But it has decided the economic recovery is strong enough to start carefully dialing back some of its stimulus efforts over the next year. It also meets Thursday.
“Although ECB President Lagarde stated last week that the central bank has no motive to move as quickly as the Fed, pressure on the central bank to decrease support is increasing,” Naeem Aslam of Avatrade said in a commentary.
Germany’s DAX lost 0.5% to 15,531.97, while the CAC 40 in Paris shed 0.4% to 7,099.12. Britain’s FTSE 100 edged 0.1% lower, to 7,574.69. The future for the S&P 500 slipped 1%, while that for the Dow Jones Industrial Average gave up 0.3%.
Investors have been reviewing the latest round of corporate earnings to gauge the damage that rising costs on different industries and consider how companies will deal with inflation moving forward.