Indian equity benchmarks edged lower on Tuesday, as financial stocks fell, and economists doubted whether the new loan guarantees announced by the government as relief measures would boost growth.
By 2:32 pm, the blue-chip NSE Nifty 50 index was down 0.30 per cent at 15,767.20 and the benchmark S&P BSE Sensex fell 0.26 per cent to 52,597.28.
“All positive factors are already incorporated in the market, and there is no big event or positives which can help a further rally… We are seeing a bit of consolidation,” said Gaurav Garg, head of research at CapitalVia Global Research in Mumbai.
Industry leaders and economists said on Monday government’s new guarantees on bank loans to small businesses and tourism sectors, announced by the finance minister, would not be sufficient to boost economic growth.
“The market has reacted negatively because most of the measures which were announced are… a repetition of what they said in the budget,” Garg said, adding that the impact of the measures at the ground level will take some time to reflect.
In Mumbai trading, the Nifty Bank index fell 0.80 per cent. Private-sector lenders ICICI Bank and HDFC Bank lost 1.3 per cent and 0.7 per cent, respectively.
HDFC Life Insurance Co fell as much as 2.3 per cent. Media reports said the company’s promoter Standard Life is selling a 3.46 per cent stake in the insurer at a discount to HDFC Life’s Monday closing price.
The government’s announcement to extend loan guarantees to the tourism sector, however, boosted airline stocks. InterGlobe Aviation and Spicejet gained 0.5 per cent and 2.3 per cent, respectively.
In global markets, broader Asian shares edged lower on concerns that new coronavirus outbreaks in the region could undercut an economic recovery.