India

Indian shares close lower as Reliance drags

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A woman walks past the Bombay Stock Exchange (BSE) building in Mumbai, India, January 31, 2020. REUTERS/Francis Mascarenhas

BENGALURU, Aug 6 (Reuters) - Indian shares closed lower on Friday, snapping a four-day winning streak, weighed down by heavy-weight Reliance Industries after India's top court ruled in favour of the arbitration order stopping Future Retail's sale of assets to the conglomerate.

The NSE Nifty 50 (.NSEI) fell 0.35% to 16,238.20 and the S&P BSE Sensex (.BSESN) slid 0.4% to 54,277.72. The indexes still closed 3% higher for the week.

Shares of Reliance (RELI.NS) and Future Retail Ltd (FRTL.NS) dropped 2.1% and 9.9%, respectively, after India's Supreme Court validated an arbitration order stopping the conglomerate's $3.4 billion deal to buy Future Retail. read more

Meanwhile, India's central bank on Friday held rates at record lows as widely expected, but it raised its inflation forecast and said it would normalise liquidity conditions in a signal policymakers could be edging closer to tapering pandemic-induced stimulus. read more

"It is unlikely that the RBI will change its stance in the October policy, although the split voting pattern could further increase," Kotak Mahindra Bank said in a note.

"We expect the start of policy normalization in the form of hike in reverse repo rate could be around the December policy after risks of further Covid wave fade.

The benchmark 10-year bond yield rose to 6.24%, while the Indian rupee closed at 74.16 against the dollar.

Among individual stocks, Strides Pharma Science Ltd (SRID.NS) fell 6.3% after reporting net loss in the June quarter.

Shares of Vodafone Idea (VODA.NS) rose over 19% on a report lenders of the debt-laden telecom operator were in talks to swap their debt for equity .

Among other shares, Glenmark Life Sciences (GLEM.NS) closed 4% higher in its debut in the Mumbai market after its initial public offering was oversubscribed 44 times.

($1 = 74.1050 Indian rupees)

Reporting by Nallur Sethuraman in Bengaluru; Editing by Krishna Chandra Eluri

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