Indian shares surrender early gains as financials offset rise in IT, pharma
Updates at 10:34 a.m. IST
By Bharath Rajeswaran
BENGALURU, Sept 10 (Reuters) -Indian shares were largely flat on Tuesday, erasing their openinggains, as a drop in life insurance stocks on worries of slowing growth momentum weighed on high-weightage financials and offset a rise in IT andpharma stocks.
The Nifty 50 index .NSEI was up 0.02% at 24,942.55 points, while the S&P BSE Sensex .BSESN was little changed at 81,611.77, as of 10:34 a.m. IST.
Both the benchmark indexes roseabout 0.25% in early trade before surrendering gains, weighed down byfinancials .NIFTYFIN, which lost 0.5%.
Life insurers HDFC Life HDFL.NS and SBI Life SBIL.NS lost 2.5% each, after posting modest growth in premiums for August.
"Growth slowdown was sharper for large insurers compared to small insurers while growth in the number of policies sold also moderated in August," said analysts at HSBC Securities and Capital Markets (India).
The drop in financials offset a 0.7%rise in theinformation technology index .NIFTYIT.
Pharma stocks .NIPHARM gained 1% after India's goods and services tax (GST) council recommended a reduction in tax rates on specific cancer drugs.
Meanwhile, theU.S. consumer price index, due on Wednesday, is expected to show that inflation remains on the path back to the Federal Reserve's target and play a crucial part in deciding thesize of a likely ratecut next week.
U.S. inflation and jobless claims data willbe pivotal in determining the market'sdirection, Centrum Institutional Research said, adding that the domestic market is currently navigating a delicate balance between potential rate cuts and U.S. recession apprehensions.
Among individual stocks, snackmakers like Gopal Snacks GOPA.NS, Prataap Snacks PRAT.NS and Bikaji Foods BIKA.NS rose about 4% each after the GST council recommended cutting the taxrate on Indian savory snacks to 12% from 18%.
The more domestically focussed small- .NIFSMCP100 and mid-caps .NIFMDCP100 rose about 1% each.
Reporting by Bharath Rajeswaran in Bengaluru; Editing by Rashmi Aich and Sonia Cheema
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