Indian shares fell 0.3 percent on Tuesday to their lowest close in a month as shaky global markets and concerns about the US economy cast a shadow on the outlook for risk appetite. The 30-share index, however, stretched a monthly winning streak to three, but analysts were uncertain if it could sustain the trend.
Data showing the economy grew an annual 8.8 percent in the June quarter, the fastest clip in nearly three years, failed to excite investors as it was in line with expectations. The BSE index fell 0.34 percent, or 60.99 points, to 17,971.12, its lowest close since July 30. The benchmark rose 0.6 percent in August, while its peers such as Brazil's Bovespa and Russia's RTS index are down 4.8 percent and 5.1 percent respectively and China's Shanghai Composite index closed barely changed.
Reliance Industries, which has the heaviest weight on the main index, dropped 3.1 percent to 918.85 rupees, after it said late on Monday its subsidiary had acquired a 14.12 percent stake in hotel chain EIH Ltd for $217.5 million. Financials closed mixed as demand outlook for loans remained positive on robust economic growth even as interest rates were seen rising.
Top lender State Bank of India fell 1.3 percent, while rivals ICICI Bank and HDFC Bank firmed nearly 1 percent and 0.1 percent respectively. More than two shares declined for every share that advanced in the broader marker on relatively lower volume of 345 million shares. The 50-share NSE index closed 0.2 percent lower at 5,402.40. Mortgage lender Housing Development Finance Corp dropped 0.5 percent to 624.15 rupees, as Goldman Sachs downgraded the stock to "sell" from "neutral".
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