Nifty retreats from record highs; Axis Bank slumps


Business, Market

The benchmark Sensex fell as much as 0.44 percent to 32,464.40.

A broker in looks at at changing share prices at BSE. (Photo: File)

Mumbai: The NSE Nifty edged lower on Wednesday, retreating from record highs hit in the previous three sessions after a rise in bad loans at Axis Bank sparked concerns about the recovery of stressed assets in the country’s banking sector.

Axis Bank, which fell as much as 9.4 percent to its lowest since Feb. 1, reported on Tuesday a smaller-than-expected profit for the September-quarter, as gross bad loans rose to about 6 percent.

That re-ignited uncertainties about provisioning for loan defaults, dampening sentiment ahead of results from key private sector lenders.

The benchmark Sensex fell as much as 0.44 percent to 32,464.40, while the Nifty looked set to snap a four-session win streak, losing as much as 0.49 percent to 10,184.35.

“The market decline is mainly because of the disappointing set of numbers brought in by Axis Bank,” said Deepak Jasani, head of retail research at HDFC Securities. “The rise in the bank’s bad loans provides a reality check on the non-performing loan situation at the ground level.”

Axis Bank contributed to most of the losses on the NSE index, and also led the losers on the NSE Bank index, which shed about 1.4 percent.

ICICI Bank (ICBK.NS), which declined as much as 4.1 percent, and HDFC Bank Ltd (HDBK.NS) are set to report second-quarter results next week.

“State-run and private corporate-facing lenders are still not out of the woods as loan slippages continue to mount and that remains a concern,” Jasani said.

Shares of Wipro Ltd (WIPR.NS) however rose as much as 3.2 percent after second-quarter profit beat estimates and as the software services exporter said it would match industry growth rates by the fourth quarter.

Indian share markets are closed on Thursday and Friday, but will open for a one-hour special trading session on Thursday evening to mark Diwali, the Indian festival of lights.