India's benchmark BSE index posted its worst monthly fall in more than two years, raising concerns a strong rally that saw indexes surge in the fiscal year was waning due to concerns about stock valuations and a more gradual economic growth.
For the month, the BSE index fell 4.8 percent, its worst monthly performance since February 2013. The NSE index lost 4.6 percent, its biggest decline since August 2013.
The falls provided a weak end to a stellar year for Indian shares as the BSE index gained 24.9 percent in 2014-15, its best since 2009-10, while the NSE index rose 26.7 percent.
Although hopes remain strong on the ability of Prime Minister Narendra Modi-led government to revive growth in Asia's third-largest economy, investors are also growingly concerned that improvements may take longer than expected.
"Economic recovery has not been robust so far, so FY16 is expected to be more volatile than FY15," said Aneesh Srivastava, chief investment officer at IDBI Federal Life Insurance.
For the day, the BSE index ended 0.07 percent lower, while the 50-share NSE index lost 0.02 percent. Losses were led by bank stocks such as ICICI Bank on anticipation of no rate cut at the central bank's upcoming policy review on April 7.
But some blue chips gained on year-end window dressing, with Tata Motors rising 1.9 percent.
Reliance Industries gained 1.9 percent after Morgan Stanley upgraded the stock to "overweight" from "underweight", citing confidence about the conglomerate's downstream projects and improving outlook for telecoms business.
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