Indian shares back further away from record highs

Indian shares fell on Wednesday, edging further away from record highs scaled last week as private banks and tech stocks extended losses, with broader concerns about the pace of global economic recovery also weighing on sentiment.

The blue-chip NSE Nifty 50 index (.NSEI) declined 0.54 per cent to 17,652.55 by 0500 GMT and the benchmark S&P BSE Sensex (.BSESN) fell 0.69 per cent to 59,253.9 in volatile trading ahead of the September F&O expiry on Thursday.

The Nifty index for volatility (.NIFVIX) jumped 3.6 per cent. Gaurav Garg, head of research at CapitalVia Global Research, said volatility would continue until the market saw a “healthy correction from record levels”.

Broader market sentiment was also weighed down by economic uncertainties ahead of a scheduled tightening of US monetary policy and deepening concerns about persistent inflation that have sent US Treasury yields soaring.

“There seems to be some late realisations about the Federal Reserve’s comments from earlier this month... with tapering now on the horizon,” said Garg.

Tech stocks (.NIFTYIT) dropped about 1.3 per cent and were down for a third straight session, with Tech Mahindra (TEML.NS) shedding nearly 2 per cent to be the top Nifty 50 loser.

Meanwhile, the rupee crossed the 74.0 level against the dollar, as the greenback was buoyed by rising US yields.

Private banks (.NIFPVTBNK) also extended losses, down 1.1 per cent. ICICI Bank (ICBK.NS) slipped 1.8 per cent to lead losses on the sub-index.

Metal stocks (.NIFTYMET) advanced 0.8 per cent, with Coal India (COAL.NS) jumping more than 10 per cent to be the top Nifty 50 gainer.