By Bharath Rajeswaran and Hritam Mukherjee
(Reuters) -Indian shares reversed early gains on Monday, as broad-based profit-booking overpowered a post-results rally in top private lender HDFC Bank.
The NSE Nifty 50 fell 0.27% to 24,787.7 points as of 10:21 a.m. IST, while the BSE Sensex shed 0.1% to 81,148.66 points. They had gained about 0.4% near the open.
HDFC Bank, the heaviest-weighted stock on the Nifty, rose 3.5% after posting September-quarter earnings above expectations. It helped lift the financials sector.
But all the other sectoral indexes logged losses and 38 Nifty 50 constituents declined as the largely disappointing quarterly earnings season continued.
Kotak Mahindra Bank fell 6% after reporting a sequential margin contraction and asset quality deterioration. Tata Consumer Products shed 8.4% after its core margins fell short of most analysts’ estimates.
“With an interplay of sustained foreign outflows and lacklustre earnings season, profit booking could continue further in domestic equities,” said Feroze Azeez, deputy chief executive officer at Anand Rathi Wealth.
The Nifty 50 gained about 15% in the last four months, helped by policy continuity and macroeconomic stability.
However, since hitting a record high on Sept. 27, it has shed 5.6%, largely due to the exodus of foreign funds from India to China.
“The “sell India, buy China” strategy of foreign investors on the back of China stimulus measures is likely to be a short-term phenomenon and the quality of earnings will drive buying interest on a stock-specific basis as the results season unfolds,” Azeez said.
Among individual stocks, RBL Bank lost 13% after reporting its quarterly profit and net interest margin fell due to an adverse loan mix.
Among the few bright spots, IT major Tech Mahindra also rose 2.5% after reporting a growth in quarterly revenue.
JM Financial rose 3.5% after the central bank lifted its ban on the investment banker and brokerage services provider’s unit, JM Financial Products.
(Reporting by Bharath Rajeswaran and Hritam Mukherjee in Bengaluru; Editing by Rashmi Aich and Savio D’Souza)
