MUMBAI (NewsRise) -- Indian shares fell for the third straight session, hitting eight-week lows, led by losses in financial and consumer company stocks.
The BSE Sensex slipped 0.5% to 37,121.22 and the Nifty 50 Index dropped 0.4% to 11,234.35. Both the indexes closed at their lowest level since Jul. 26. HDFC Bank and Housing Development Finance Corp. fell 1.6% and 1.4%, respectively. Index-heavyweight ITC and Hindustan Unilever declined around 1% each. Reliance Industries closed 0.6% lower. Maruti Suzuki India fell 2.3%.
Indian asset management companies were among the major losers on Wednesday after India's market regulator cut the total expense ratio (TER) for mutual funds. Reliance Nippon Life Asset Management tumbled 11.3% to 190 rupees and HDFC Asset Management slipped 8.5% to 1,408.55 rupees.
Nomura said in a note that the TER cut of up 25 basis points will derail profitability for AMC's, prompting a suppression of valuation multiple. It cut the target price on Reliance Nippon to 210 rupees from 315 rupees earlier after slashing the valuation multiple by one-third.
Titan dropped as much as 4% to 788.15 rupees, before ending little changed. CLSA reportedly downgraded the jewellery company to 'sell' and cut the target price to 720 rupees.
The Sensex's losses came despite advances on most regional indexes and positive Wall Street leads. U.S. equities put in their best performance in three weeks overnight despite the latest tit-for-tat tariffs by Washington and Beijing. Following the Trump administration's move to impose new tariffs of 10% on $200 billion of Chinese shipments earlier in the day, Beijing said after Asian markets closed on Tuesday that it will levy extra duties of up to 10% on $60 billion worth of U.S. imports with effect from next week.
President Donald Trump's reported remarks that he was always open to talking with China and that he may make a deal at some point helped risk assets navigate the latest retaliatory tariffs.
Tata Steel added 1.3%, JSW Steel advanced 2.4%, and Steel Authority of India climbed 1.6% after Reuters reported that India may raise the import duty on some steel products to 15%.
The government will likely announce a list of non-essential import curbs very soon, Economic Affairs Secretary Subhash Chandra Garg said Wednesday, while stressing on New Delhi's resolve to stick to the fiscal gap aim amid a plunging rupee and higher crude oil prices.
Meanwhile, sugar stocks continued to rise amid expectation the government will limit buffer stocks at five million tons in the next sugar season, a senior government official said Tuesday. The government proposes to bear the transportation and handling cost of the sugar buffer stock, the official added. Dhampur Sugar Mills gained 7.3%, and Bajaj Hindustan Sugar and Balrampur Chini Mills rose 3% each.
Multi Commodity Exchange of India advanced 3% to 806.55 rupees after India' market regulator approved the framework for allowing foreign investors to hedge on Indian commodity bourses. Motilal Securities maintained the 'buy' rating and its target price of 1,000 rupees on the stock, saying that the move will encourage domestic firms to trade on Indian exchanges.
India's financial markets are closed on Thursday for a local holiday.
--Dipika Lalwani and Nimesh Vora