Bombay Stock Exchange (BSE). (File Photo: IANS)
BENGALURU: Indian shares slipped on Tuesday, dragged lower by telecoms and automotive stocks, as investors remained wary in the absence of any announcement about a government fiscal stimulus package and ahead of key inflation data.
The fall in domestic markets was in line with declines in broader Asia, as fears about a drawn-out Sino-U.S. trade war, protests in Hong Kong and a crash in Argentina’s peso currency drove investors to safe harbours.
The broader NSE Nifty fell 0.09% to 11,099.15 as of 0513 GMT, while the benchmark BSE Sensex tumbled 0.11% to 37,540.82.
Meanwhile, the rupee weakened by 0.4%, hitting a near six-month low of 71.2000 against the dollar.
India’s retail inflation for July will likely rise, data is expected to show on Tuesday, amid a continued rise in food prices which have risen due to lower-than-expected monsoon rains over the past two months.
The NSE Nifty has so far slipped nearly 9% since hitting a 2019-high in April amid worries of slowing economic growth and a proposal to raise taxes for foreign portfolio investors.
On Friday, India’s finance minister Nirmala Sitharaman gave no indication at a meeting with foreign portfolio investors that she would withdraw a budget proposal to raise their taxes.
Sitharaman is still widely expected to amend some budget proposals and announce new measures to boost economic growth, although an absence of any such announcement may be unnerving investors, said Saurabh Jain, assistant vice-president of research at SMC Global Securities in Mumbai.
“No concrete action has been taken so far, despite assurances from the finance minister and the prime minister’s office,” Jain said.
Telecom stocks slipped after Reliance Industries Ltd unveiled plans to launch high-speed internet services and free high definition TV with annual data subscription plans under its telecom arm Jio, which has upended India’s telecom sector.
Bharti Airtel and Vodafone Idea, two of India’s top three telecom firms, slipped 6% and 4.7% respectively, dragging the Nifty infrastructure index lower by 2.45%.
Cinema chains Inox Leisure Ltd and PVR Ltd also fell, about 4.6% and 2.6%, respectively.
Meanwhile, Reliance Industries rose 11.3%, putting the stock on course for its best day in over a decade, after the conglomerate also announced a $15 billion sale of a 20% stake in its oil-to-chemicals arm to Saudi Aramco.
The Nifty Auto Index fell 1.3% amid an industry-wide slowdown in demand and ahead of the release of monthly sales figures for July by a trade body on Tuesday.