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Indian shares trim losses on IT recovery; recession fears linger

Indian shares pared most of the losses in the final hour helped by rebound in IT stocks, while recession worries and a surge in Covid-19 cases in China continued to dampen sentiment

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Reuters BENGALURU

BENGALURU (Reuters) -Indian shares pared most of the losses in the final hour of a volatile session on Tuesday, helped by a rebound in information technology stocks, while recession worries and a surge in COVID-19 cases in China continued to dampen sentiment.

The Nifty 50 index closed 0.19% lower at 18,385.30 and the S&P BSE Sensex lost 0.17% to 61,702.29.

Thirty nine of the Nifty 50 constituents logged losses, while IT major Tata Consultancy Services and index heavyweight Reliance Industries recovered to help the benchmark trim its losses. Both the Sensex and Nifty slipped more than 1% during the session.

 

All the sectors, barring information technology, oil & gas and metals declined, while auto and FMCG stocks lost more than 0.6%.

"Markets are fearing that recession is going to be extremely strong in the U.S. and Europe," said Avinash Gorakshakar, head of research at Profitmart Securities.

Analysts added that U.S. macroeconomic data due later this week, the uncertainty over demand revival in China as well as the minutes of the latest RBI policy meeting which will be released on Wednesday could have an impact on Indian markets in the very near term.

They attributed the rebound in select I.T. stocks to 'buy-on-dip' strategy by investors after the recent correction in the sector. Nifty IT had logged losses in each of the last three sessions, losing over 3%.

Asian markets fell sharply on Tuesday after the Bank of Japan made a surprise tweak to its bond yield control that allows long-term interest rates to rise more.

That added to concerns after China's business confidence fell to its lowest since January 2013 and the recent surge in COVID-19 infections in the country. The MSCI Asia ex Japan declined 1.06%.

Among individual stocks, Dabur India fell on a report that its promoters are planning to sell shares worth 8 billion rupees ($96.71 million), while an uptick in Adani Enterprises led to Nifty Metal erasing its losses.

TCS and Mphasis were the top gainers in the index, which swung to gains after shedding nearly 1.6% during the session.

($1 = 82.7200 Indian rupees)

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Janane Venkatraman)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Dec 20 2022 | 5:43 PM IST

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