By Bharath Rajeswaran and Vivek Kumar M
(Reuters) -Indian shares fell on Thursday, weighed down by losses in IT stocks after Tech Mahindra missed quarterly revenue estimates, while uncertainty over U.S. Federal Reserve Chair Jerome Powell’s tenure led to caution among investors.
The Nifty 50 fell 0.4% to 25,111.45, while the Sensex lost 0.45% to 82,259.24. The Nifty is down 0.15% so far this week.
The broader, more domestically focussed smallcaps and midcaps fell 0.1% and 0.2% respectively.
Citi downgraded Indian equities to “neutral” from “overweight”, citing stretched valuations.
Asian markets were muted as uncertainty over the future of Fed Chair Powell raised concerns about U.S. monetary policy and capital flows into emerging markets.
India’s IT companies lost 1.4% on the day, making them the top sectoral losers. Tech Mahindra fell 2.8% after reporting a marginally lower-than-expected revenue a day earlier.
“IT earnings have been predictably underwhelming and have kept the markets on a tight leash,” said Samrat Dasgupta, CEO of Esquire Capital Investment Advisors.
“With the India–U.S. trade deal still hanging in the balance and Trump’s comments on Powell’s tenure stirring fresh unease, investor nerves aren’t exactly settling,” Dasgupta said.
Heavyweight financials and banks dropped 0.4% and 0.6%, respectively. Axis Bank fell 0.6% ahead of its results.
The metals index gained 0.7%, led by Hindalco and Tata Steel which rose 1.2% and 1.7%, respectively, capping losses in the benchmarks.
Among other individual stocks, HDFC Asset Management gained 2.9% on posting a 24% rise in quarterly profit.
Auto components maker Sona BLW Precision Forgings jumped 6.8% after CNBC-TV18 reported the company is in advanced talks with China’s BYD to supply electric vehicle components.
The market is likely to stay stuck in a consolidation mode until there are signals of a consumption recovery or credit growth, Esquire Capital’s Dasgupta said.
(Reporting by Vivek Kumar M and Bharath Rajeswaran; Editing by Mrigank Dhaniwala, Nivedita Bhattacharjee and Sonia Cheema)
