Mumbai: Markets dropped 0.5% in choppy trade on Monday tracking other Asian markets after a spate of weak economic data from China and the United States renewed concerns about the health of the global economy.
The fall was led by software services bellwether Infosys , which gets more than half its revenue from the United States. Rivals Tata Consultancy Services and Wipro also dropped.
US jobs growth ground to a near halt in June as employers hired the fewest workers in nine months, frustrating hopes that data would start to show an improving economy into the second half of the year. .
Maruti Suzuki , the country’s top car maker, shed 2.5% after industry data showed rising interest rates, fuel prices and vehicle costs were denting demand in the world’s second-fastest growing auto market. .
Domestic car sales for the industry rose 1.6% in June, the slowest pace of growth in more than two years.
Banks including ICICI Bank and State Bank of India fell more than 1% as concerns remained over hardening interest rates impacting growth.
At 12:06pm, the 30-share BSE index was down 0.46% at 18,771.13 points, with 18 of its components losing ground.
“We believe the fall is only temporary. It is just a reaction to what has been happening in other Asian markets,” said Kishor Ostwal, chairman and managing director at CNI Research.
“The trend is more bullish now. We are also seeing money flowing in from foreign funds,” he said.
Foreign funds had bought shares worth $2.42 billion over 11 sessions to last Thursday, data from the market regulator showed, helping the main index rise for three consecutive weeks.
However, slowing global and domestic growth are concerns. China’s import growth fell sharply to its slowest pace in 20 months in June, while Beijing remained focused on fighting inflation.
Infosys fell nearly 3% ahead of its quarter earnings on Tuesday. The company and bigger rival Tata Consultancy may report a decline of 241 basis points and 205 basis points respectively in June-quarter operating margins compared with the previous quarter, largely due to wage hikes, Standard Chartered analysts wrote in a report on July 4.
Tata Consultancy and Infosys are expected to see profit growth of 16% to 24% respectively for their fiscal first quarter, according to a Reuters poll of analysts. .
The Nifty India stock futures in Singapore dropped 0.20%.
Losers beat gainers 746 to 599 on volume of about 190 million shares in the broader market.
The MSCI’s measure of Asian markets other than Japan was down 1.3%, while Japan’s Nikkei fell 0.7%.
United Breweries Ltd rose nearly 7% after it said UBL Benefit Trust sold its entire stake in the company for Rs 285 crore. The firm is the sole beneficiary of the trust.
Indo Asian Fusegear was up 1% at Rs 79.95 after the company said its board had approved a buyback of up to 1.78 million shares at up to Rs 130 each.