BENGALURU Indian shares tracked global equity markets lower on Thursday on rising concerns about the long and difficult path to economic recovery from the coronavirus outbreak.
The country is staring at a prolonged slowdown as the health crisis grips rural areas, according to the government and analysts. Meanwhile, the U.S. Federal Reserve minutes showed policymakers remained doubtful about a swift rebound in economic growth.
The blue-chip NSE Nifty 50 index fell 0.71% to 11,325.80 by 0422 GMT and the S&P BSE Sensex slipped 0.81% to 38,307.41.
“It is a knee-jerk reaction to news coming out of the United States. Everyone knows the economy is in a bad state but times like this allows for price correction in a market where valuations are high,” said Umesh Mehta, head of research at Samco Securities, Mumbai.
Indian equities have seen a rally over the last few sessions, with the Nifty rising over 2% this week so far and the Sensex gaining nearly 2%, but analysts have warned that the markets have been overvalued and these gains do not reflect economic reality.
Other Asian markets slipped and MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.24%.
Coronavirus cases continued to rise with India reporting a record daily jump of 69,652 infections on Thursday morning, taking the total cases to 2.84 million and deaths to 53,866, data from the federal health ministry showed.
Financial stocks lost the most, with the Nifty Financials index and Nifty private bank index slipping 1.08% each.
Shares of private sector lender ICICI Bank Ltd fell over 2% and was the top drag on both the indexes.
The Nifty auto index which had rallied over 3% this week was down 0.37% on Thursday.
Bucking the trend, the Nifty pharma index edged up 0.5% led by a 1.47% rise in Divis laboratories Ltd.
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