Mumbai: India’s main stock indexes edged lower on Friday, snapping three sessions of mild gains, after interest rate cuts in China and the euro zone sparked alarm about global economic growth, hitting Infosys ahead of its earnings results next week.
The falls tracked lower Asian shares given concerns the measures denoted a certain measure of alarm among central bankers, with attention shifting to the US jobs monthly data due out later in the day.
These global risk factors have capped gains in local shares this month after a rally in June, as Indian stock markets are largely influenced by foreign flows.
“From macro aspect the global direction would be the most important especially oil prices and liquidity flows,” said Deven Choksey, managing director at K R Choksey Securities in Mumbai.
“Corporate results, as well as guidance, are expected to be disappointing, but do not expect a derating as there are a lot of people sitting on cash, who would deploy the same if markets go down on just earnings disappointment.”
The 30-share BSE index fell 0.1% after closing on Thursday at its highest since April 3. However, for the week, the country’s benchmark index rose 0.5%, enough to notch its fifth consecutive weekly gain.
The broader 50-share NSE index fell 0.19%.
Indian markets ended Friday in the red. Mint’s Krishna Merchant tells us what stocks moved during the session and how the indices behaved through the week.
Traders are gearing up for the start of corporate earnings reports starting next week, with Infosys and Tata Consulting Services the first companies to report.
Infosys shares fell 1.4%, as the worries about the global economy are cementing expectations India’s second-biggest software service exporter will cut revenue guidance given evidence of reduced technology spending worldwide.
Infosys shares fell 1.4%, ahead of its results due on July 12.
However, top-ranked Tata Consulting Services, which also reports on Thursday, rose 0.6%.
Energy and environment solutions provider Thermax fell 2.2% after Goldman Sachs downgraded the stock to “sell” from “neutral”, saying its rally over the past one month was “unjustified” given a “challenging” outlook for orders and profitability.
However, among gainers, ITC advanced 0.9%, gaining for a second day, benefiting as a defensive play.
State-run oil retailers rose on news they received Rs 14,000 crore ($2.5 billion) from the government since the end of June as part of the subsidy payout for the financial year ended in March, according to three officials with direct knowledge.
Indian Oil Corp rose 1.7%, Bharat Petroleum Corp rose 0.7%, while Hindustan Petroleum Corp gained 0.9%.
Indian movie producer and distributor Eros International Media Ltd rose 3% after announcing a licensing deal with television channel Colors Viacom 18, a joint venture between TV18 and Viacom, for an undisclosed amount.