Financials, IT drag Indian shares as solid US data rekindles rate worries

BENGALURU, July 28 (Reuters) - Indian shares fell on Friday, dragged by losses in financials and information technology (IT) stocks after strong economic data from the U.S. reignited rate concerns, while Asian peers were subdued after Japans central bank left rates unchanged.

The Nifty 50 (.NSEI) index was down 0.20% at 19,621.80, while the S&P BSE Sensex (.BSESN) fell 0.30% to 66,070.83 at 10:58 a.m. IST.

Both the benchmarks are on course for a weekly loss after rising for four straight weeks. The Nifty 50 and Sensex are down 0.64% and 0.91%, respectively, so far this week.

The benchmarks rose nearly 6% over the last four weeks.

While benchmarks declined, the broader peers showed resilience with the smallcaps (.NIFSMCP100) and midcaps (.NIFMDCP100) gaining 0.5% and 0.4%, respectively, on the day.

Five of the 13 major sectoral indexes logged losses, with high weightage financials (.NIFTYFIN) losing 0.7% and IT (.NIFTYIT) falling 0.8%.

Asian markets erased losses after the Bank of Japan kept policy rates unchanged, after sliding ahead of the decision on speculation that it may take steps to remove stimulus measures.

Wall Street equities closed lower after stronger-than-expected GDP data in the June quarter dampened hopes of an end to the U.S. Federal Reserves policy tightening. The resilience in the U.S. economy provides room for the central bank to raise rates further to bring inflation down to its 2% target. [MKTS/GLOB]

“Most investors could hold back their investments and also start booking some profits at current levels after the recent rise,\” said Raghavendra Nath, managing director at Mumbai-based investment advisory firm Ladderup Wealth Management.

Among individual stocks, high weightage Reliance Industries (RELI.NS) rose 1% and capped further index losses. The stock had fallen 4.5% over the last five sessions after demerging its financial services unit.

Realty firm Macrotech Developers (MACE.NS) lost as much as 4.43% after reporting a fall in June-quarter profit.