Indian shares fall over 1% as surging COVID-19 cases renew growth worries

BENGALURU, March 25 (Reuters) - Indian shares closed sharply lower for a second straight session on Thursday, led by losses in energy and technology companies, due to renewed concerns over the impact of surging coronavirus cases on economic growth.

The blue-chip NSE Nifty 50 index and the benchmark S&P BSE Sensex each fell 1.5% to 14,324.90 and 48,440.12, respectively. The indexes had dropped nearly 2% in the previous session.

India’s daily COVID-19 cases hit a five-month high on Thursday and the country put a temporary hold on all major exports of the AstraZeneca coronavirus shot made by the Serum Institute of India to meet domestic demand. [nL1N2LM3IG

“Although the Indian gross domestic product has reverted to pre-covid levels in the third and fourth quarter, uncertainty related to the near-term outlook has risen considerably in the recent weeks, following the spate of new Covid-19 infections,” Aditi Nayar, principal economist, ICRA said in a note.

“The uncertainty will persist over the next few months, until the vaccines become available in India for all adults.”

India’s central bank governor, Shaktikanta Das, called the increase in COVID-19 cases a “matter of concern”, but said the country was better prepared to tackle the situation.

The Nifty energy index fell 2.9%, dragged down by a 2.7% fall in heavyweight Reliance Industries.

The Nifty information technology index fell 2.2%, led by a more than 1% drop in Infosys and Tata Consultancy Services.

Only six Nifty 50 stocks traded in the positive territory.

Shares of speciality chemicals maker Laxmi Organic Industries surged nearly 19% in their market debut in Mumbai, while those of engineering company Craftsman Automation dropped 8.8%. (Reporting by Nallur Sethuraman in Bengaluru; Editing by Vinay Dwivedi)