Indian shares fall as tech firms drag; Fed rate decision eyed

A woman walks past the Bombay Stock Exchange (BSE) building in Mumbai, India, January 31, 2020. REUTERS/Francis Mascarenhas

BENGALURU, July 26 (Reuters) – Heavyweight technology stocks dragged India’s blue-chip share indexes lower on Tuesday, ahead of earnings reports from several large-cap companies, with investors also bracing for a likely sharp interest rate hike in the United States this week. .

The NSE Nifty 50 index (.NSEI) was down 0.66% at 16,521.5, by 0448 GMT, while the S&P BSE Sensex (.BSESN) slipped 0.69% to 55,382.58.

“Investors are likely to be in a wait-and-watch mode as all eyes will be on the US Federal Reserve’s rate decision,” said Prashanth Tapse, research analyst at Mehta Equities.

Asian peers were also on tenterhooks ahead of the likely 75-basis-point Fed rate hike, while a profit warning from US retailer Walmart dampened sentiment.

“After Walmart’s comments on inflation and growth, market jitters have increased ahead of the Fed policy meeting, and that has spilled over into the domestic market despite a better than expected earnings season,” said Aishvarya Dadheech, a fund manager at Ambit Asset Management.

Meanwhile, after heavy foreign outflows every month since November, Indian equities have received a net $52.95 million of inflows this month until Monday. For the month so far, the Nifty and the Sensex are up about 4.5% each.

Private lender Axis Bank (AXBK.NS) slid 2.3% in its biggest intraday percentage drop in nearly a month despite a beat on quarterly profit, as analysts flagged soft loan growth.

The Nifty IT index (.NIFTYIT) slid 2.3% and was the worst performer among sub-indexes, with IT major Infosys (INFY.NS) dropping 3%.

Helping cut losses on the Nifty 50 was a 3.7% rise in financial services firm Bajaj Finserv (BJFS.NS) on plans to issue bonus shares and split its stock.

Nifty 50 components Bajaj Auto (BAJA.NS), Asian Paints (ASPN.NS) and Larsen & Toubro (LART.NS) will report their results later in the day.

Reporting by Chris Thomas in Bengaluru; additional reporting by Gaurav Dogra; Editing by Subhranshu Sahu and Uttaresh.V

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