Indian shares slide on weakness in metal, financial stocks

48 of the 50 stocks on the Nifty were trading in negative territory on Thursday

  
A woman walks past the Bombay Stock Exchange (BSE) building in Mumbai, India, January 31, 2020. Image used for illustrative purpose

A woman walks past the Bombay Stock Exchange (BSE) building in Mumbai, India, January 31, 2020. Image used for illustrative purpose

REUTERS/Francis Mascarenhas

BENGALURU - Indian shares slid on Thursday and were set to snap a three-session rally, dragged down by losses in high-flying metal and bank stocks, as rising U.S. bond yields sapped investor appetite for equities globally.

The NSE Nifty 50 index fell 1.02% to 15,089.45 by 0505 GMT, while the S&P BSE Sensex dipped 1.13% to 50,856.24.

The move was in line with broader weakness in Asian shares, with MSCI's ex-Japan Asian-Pacific shares down 1.7%, as concerns about rising U.S. bond yields triggered another market rout after roiling world equities last week. 

Indian shares had recovered from the previous week's sell-off thanks to positive news around the country's vaccination drive and upbeat domestic economic growth data.

However, 48 of the 50 stocks on the Nifty were trading in negative territory on Thursday.

"Markets have rallied quite a bit and some corrections, as seen in the past week, amid rising U.S. bond yields are normal in the course of bull markets," said Narendra Solanki, head of equity research (fundamental) at Anand Rathi Investment Services.

The Nifty's metal index slid nearly 3%, erasing some of the meaty gains recorded earlier this week.

Private-sector lenders slipped 2.3%, dragged down by a near 3% drop in index heavyweight HDFC Bank.

Nifty's PSU bank index was mostly flat, having dipped as much as 1.76% in early trade.

State-owned banks' balance sheets have improved, and bad loan formation should moderate going forward, brokerage Morgan Stanley said in a note on Wednesday.

Bucking the trend, Adani Ports rose as much as 2.41% and was the top percentage gainer on the Nifty after it said it would buy a 31.5% stake in Gangavaram port for 19.54 billion rupees ($267.65 million). 

($1 = 73.0050 Indian rupees)

(Reporting by Chandini Monnappa in Bengaluru; Editing by Aditya Soni) ((Chandini.M@thomsonreuters.com; +918061822697;))

More From Equities