Mumbai: Indian shares were slightly lower on Wednesday morning, with financials leading the fall after China’s increase in banks’ reserve requirements spurred losses across Asia, but gains in outsourcing firms offered support.
Banks were also under pressure on concerns their December quarter results could be subdued on slowing loan growth and as a sharp rise in bond yields last year hits treasury income.
“For the December quarter, banks’ performance is going to be muted because of lack of credit growth. Also, higher provisioning norms may make an impact,” said Deven Choksey, managing director and CEO of K. R. Choksey Shares.
Top private lender ICICI Bank dropped 1.1% to Rs832.60 while HDFC Bank declined 0.7% to Rs1,687.
At 10:39am, the 30-share BSE Index was down 0.09% at 17,407.14, with 16 components declining. The 50-share NSE index was down 0.1% at 5,206.30.
“The market is just consolidating, and it is healthy. Fund managers generally don’t really churn their portfolios until all the results are out,” said Choksey.
Tech stocks extended gains made on Tuesday when Infosys Technologies beat market expectations with its December quarter results and raised its full-year forecast.
Infosys rose 1.7% to a record high of Rs2,632. Sector leader Tata Consultancy rose 3.1% to record high of Rs772, and smaller rival Wipro rose as much as 2.6% to its highest in nearly 10 years.
Some metals stocks edged higher on expectations of robust results. Base metals prices pared losses on Wednesday, having initially fallen on concerns that China’s policy tightening on a view that growth and demand may moderate.
Leading aluminium maker Hindalco was up 1.3% and Tata Steel, the world’s eighth-largest steel maker by output, climbed 1.1%.
Non-ferrous metals producer Sterlite Industries shed 0.7% to Rs869.40.
In the broader market, gainers led losers in the ratio of 1.4:1 in a volume of 161 million shares.