Mumbai: Indian stock markets are likely to be under pressure on Thursday following weakness in global peers while domestic economic data weighs on sentiment.

India's factory output contracted in December and retail inflation shot up to a 68-month high in January, according data released on Wednesday, a day after the government cited seven economic indicators to claim that there was growth revival.

The National Statistical Office on Wednesday said the index of industrial production (IIP) shrank 0.3% in December compared to a 1.8% expansion a month ago, while retail inflation accelerated to 7.59% in January from 7.35% in the previous month.

Shares of Yes Bank are likely to be in focus as the private lender on Wednesday said it has received non-binding expressions of interest from at least four "prominent investors" and the capital raising effort will lead to a delay in publishing its December quarter financial results to on or before 14 March.

Meanwhile, Asian stock markets wobbled and safe-havens Japanese yen, gold and bonds rose in early deals on Thursday as the number of new coronavirus cases jumped sharply.

China's Hubei province, the epicenter of the virus outbreak, reported 242 new deaths and confirmed 14,840 new cases as on 12 February, a dramatic rise from the 2,015 new cases a day earlier.

The increase was the result of a new methodology adopted provincial officials to count infection cases although it was not immediately clear how the new methods affected results, nor why the death toll rose so sharply.

The spike dashed hopes that the spread of the virus was slowing, sending the Japanese yen 0.2% higher against the dollar and pushing yields on US 10-year Treasuries about 3 basis points lower.

It also capped gains on stock boards, with MSCI's broadest index of Asia-Pacific shares outside Japan 0.04% weaker, despite a strong rally on the Wall Street overnight. Japan's Nikkei was 0.2% lower, while Australia's ASX/S&P 200 index retreated from a record high.

The yen last traded at 109.91 per dollar while export-exposed currencies, which had rallied on confidence the virus could be contained, retraced rises.

The Australian dollar lost 0.2%, as did China's yuan and the Korean won. Gold rose 0.3% to $1570.30 per ounce.

More than 1,300 people have died from the epidemic in China and the total number of cases in Hubei province now stands at 48,206.

The Chinese economy has also been upended, with factory closures hitting supply chains - from car makers to tech firms.

(Reuters contributed to the story)

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