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Financial, energy stocks drag Indian shares as virus spread weighs

Chris Thomas /Bengaluru
Filed on June 29, 2020
The Nifty 50 has recovered around 40 per cent from a four-year low hit in mid-March, as foreign inflows returned to the market. - Reuters

The NSE Nifty 50 index closed 0.68 per cent lower at 10,312.4, while the benchmark S&P BSE Sensex was down 0.6per cent at 34,961.52, after sliding as much as 1.5 per cent earlier in the session.

Indian shares closed lower on Monday, dragged by financial and energy stocks, as a jump in coronavirus cases at home and around the world stoked fears of renewed restrictions, dimming hopes of a quick economic recovery.

The NSE Nifty 50 index closed 0.68 per cent lower at 10,312.4, while the benchmark S&P BSE Sensex was down 0.6per cent at 34,961.52, after sliding as much as 1.5 per cent earlier in the session.

Global equities were also under pressure, with MSCI's world shares index slipping to its lowest since June 15 and European shares opening slightly lower.

Coronavirus cases in India jumped to 548,318 as of Monday, with the death toll at 16,475, according to federal health ministry data. The global death toll reached half a million people on Sunday, according to a Reuters tally.

Maharashtra, home to India's financial capital Mumbai and the worst hit state by the outbreak so far, extended its lockdown to July 31.

"The economic reality is going to be on the downside, that's a given. Liquidity is the only support for global markets and that is the only hinge on which the markets are moving," said Mayuresh Joshi, head of equity research at William O'Neil & Co in India, adding that tensions with China following the recent border clashes were also denting the sentiment.

The Nifty 50 has recovered around 40 per cent from a four-year low hit in mid-March, as foreign inflows returned to the market. But the index is still down 15 per cent for the year, compared with a 7 per cent drop for the MSCI Asia index.

Shadow bank Bajaj Finance Ltd and private-sector lender Axis Bank Ltd tumbled 1.6 per cent and 4.7 per cent, respectively, after S&P Global Ratings cut their ratings to junk, while Coal India slid 5.1 per cent as quarterly profit slumped.

HDFC Bank Ltd closed 1.9 per cent higher, helping check broader losses. - Reuters

 


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