Indian shares were subdued on Wednesday as index heavyweights lagged amid weak global cues, following a sharp slump in the previous session due to heavy foreign outflows from capital markets.
The broader NSE Nifty was down 0.27% at 10,769 as of 0519 GMT, while the benchmark BSE Sensex was 0.21% lower at 36,484.86. Domestic stock markets and the rupee had plunged on Tuesday after data last week showed the economy grew at its weakest pace in over six years.
Foreign investors pulled out 20.16 billion rupees ($281.99 million) from capital markets on Tuesday, according to NSE data.
Trade sentiment globally remained subdued after data showed the U.S. manufacturing sector contracted in August for the first time since 2016 amid worries about a weakening global economy and rising trade tensions between China and the United States.
“As far as the domestic economy is concerned, the news flow is all negative, with growth concerns worsened by weak auto sales,” said Neeraj Dewan, director, Quantum Securities.
“There is nothing positive coming investors’ way for them to buy into equities. Some long term investors with deep pockets have to take a call on whether this is a bottom for the economy or not, only then will you see a revival happen.”
The rupee recovered slightly to trade at 72.25 against the dollar on Wednesday, versus last close of 72.4, but was trading near the day’s low.
Shares of Sun Pharmaceutical Industries Ltd fell as much as 5.2% after a report said that India’s market regulator ordered a forensic audit against the drugmaker to look into allegations of financial irregularities and lapses in corporate governance standards.
Automaker Tata Motors Ltd declined 5.2% and was the top percentage loser on both the indexes.
IndusInd Bank Ltd dropped 3.5%, while heavyweight conglomerate Reliance Industries Ltd slid 1.7% to its lowest in nearly four weeks.
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Source: News18