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Equities

India shares extend losses amid global equity rout

Financial stocks among biggest contributors to Sensex losses

MUMBAI (NewsRise) -- Indian shares extended losses on Monday, as equities across the world wilted amid concerns over rising U.S. yields.

The BSE Sensex slipped 0.9% to 34,757.16 and the Nifty 50 Index dropped by a similar margin to 10,666.55, marking their fifth consecutive fall that has taken the benchmark indexes to their lowest level since Jan. 12 and Jan. 11, respectively.

The losses in Indian and other regional markets came after U.S. indexes nursed their biggest loss in more than a year on Friday. Investors had more to worry on the inflation front after a U.S jobs report showed that average hourly earnings, a closely watched measure, rose at their quickest pace since 2009. That sent the yields on the 10-year U.S. benchmark bond to their highest in four years. Investors are concerned that quickening inflation may prompt the Federal Reserve to raise rates more than three times it is currently projecting.

The negative global cues come at the worst possible time for Indian markets, which are already under pressure following the government decision to impose taxes on profits derived from sale of shares held for more than a year.

"The aftershocks of long-term capital profits continue to rock Indian markets," said Sageraj Bariya, vice president of institutional sales at East India Securities. "Plus, the sharp plunge in global markets and surge in bond yields have spooked traders."

Financial stocks were among the biggest contributors to Sensex losses. Housing Development Finance Corp. tumbled 4.1%, its biggest single-day fall since Nov. 11, 2016, and IndusInd Bank fell 2.4%. Heavyweight HDFC Bank lost 1.5%, dropping for the third straight session.

India's interest rate setting Monetary Policy Committee will begin its two-day meeting on Tuesday. The panel is expected to keep rates unchanged, but will likely adopt a much more hawkish tone amid upside risks on inflation in Asia's third-largest economy.

Out of the 30-stocks on the Sensex, 18 ended lower. Infrastructure conglomerate Larsen & Toubro dropped 3.7%, its worst fall since Sep. 12, 2016.

Bharti Airtel was the day's best performer on the Sensex, advancing 4.2% after India's biggest telecom operator said that Singapore Telecommunications will invest 26.49 billion rupees ($412 million) to increase its shareholding in its holding company Bharti Telecom.

Tata Motors advanced 3.1%. The carmaker reported a more-than-13 fold increase in its consolidated net profit for the December quarter. Eveready Industries slipped 3.7% after the battery maker's net profit declined by 40.5% in the October-December quarter third quarter.

United Breweries jumped 5.6% after the beer maker reported a 17% increase in revenues for the October-December period. Net profit in the quarter declined 3%.

Colgate Palmolive India rose 0.5% after the company reported that net profit in the October-December quarter rose 34%.

Bosch's India unit advanced 3.3% after the auto component maker reported a net profit growth of 28% for the third-quarter.

--Nimesh Vora and Vidyut Deshpande

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