Indian stocks hit a three-week low on Monday, forged by losses on IT stocks after Infosys fell 9% amid weak March earnings estimates, while global inflation worries also affected the climate.
The NSE Nifty 50 index fell 1.89% to 17,142.50 points, at 0445 GMT, while the S&P BSE Sensex fell 2.15% to 57,089.44 points. In a truncated holiday week, both indices recorded weekly losses of more than 1.5% each, last week.
Leading software service provider Infosys fell 9.1% to an eight-month low on Monday.
The company’s consolidated net profit for the March quarter was Rs 56.86 billion ($ 744.24 million), lower than analysts’ expectations of Rs 59.80 billion.
This led to the Nifty IT index falling more than 4%, making it the largest decline among major indicators.
Last week, rival Tata Consultancy Services also lost ground slightly. Its shares fell 3.5% to a one-month low on Monday.
“It was a weak set of numbers from Infosys and TCS was also a disappointment; companies are under a lot of cost pressure and this will affect mid-cap stocks and we will see a revaluation,” said Saurabh Jain, assistant vice president. at SMC Securities.
Mindtree fell 5% ahead of March quarter results.
In addition to IT stocks, India’s top private sector lender, HDFC Bank, extended its losses in an eighth session, falling 3.5% after the March quarterly results were released over the weekend.
The bank’s net interest margin, a key measure of profitability, shrank due to the increase in the share of corporate loans and the slower growth of credit cards and car loans, the Jefferies Stock Exchange said in a note.
Meanwhile, many markets in Asia and Europe were closed on Monday. US futures contracts, however, fell amid rising oil prices due to the deepening crisis in Ukraine. [O/R]
“Globally, inflation concerns continue to be on the minds of investors; any new developments in the Russia-Ukraine situation will be a key decisive factor for the future,” Jain added.
($ 1 = 76.4000 Indian Rupees)
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