By Bharath Rajeswaran and Indranil Sarkar
(Reuters) -India’s benchmark indexes inched lower on Monday, dragged by consumer stocks on Godrej Consumer Products’ bleak third-quarter forecast and auto stocks after data showed a drop in car sales last month.
The NSE Nifty 50 fell 0.24% to 24,619 points, while the BSE Sensex shed 0.25% to 81,508.46,
Monday’s losses come after the benchmark indexes logged three straight weekly gains since slipping into a correction territory in November.
They gained about 2.3% last week, their best since early June, as the Reserve Bank of India eased monetary conditions on Friday by lowering the cash reserve ratio.
“Some consolidation and time correction should be the order of the day, given the markets’ recent trajectory” Devang Mehta, director of equity advisory at Spark PWM said.
Markets may only see incremental moves in the next few sessions ahead of the U.S. and domestic inflation readings this week, three analysts said.
Consumer stocks fell 2.2% on the day, the most among the major sectors, dragged by an 8.7% drop in Godrej Consumer Products as the Cinthol soap maker warned of weak sales and margin in the current quarter.
Hindustan Unilever, Tata Consumer and Nestle India were among the top five Nifty 50 losers.
Auto stocks shed 0.8% after the Federation of Automobile Dealers Association (FADA) reported a year-on-year drop in passenger vehicle and commercial vehicle sales in November.
Tata Motors fell 2.2% and was among the top Nifty 50 losers of the day.
Meanwhile, the broader, more domestically-focused small-caps and mid-caps rose 0.2% and 0.5%, respectively, posting their twelfth straight session of gains.
“Small and midcaps are seeing sustained interest because the recent market correction has taken away some of the froth in terms of valuations,” said Spark PWM’s Mehta.
This is the best winning run for small-caps in eight months and for mid-caps in one year.
Among individual stocks, tyre maker Ceat jumped 10.3% on plans to buy France-based Michelin’s Camso brand for $225 million.
(Reporting by Bharath Rajeswaran and Indranil Sarkar in Bengaluru; Editing by Sumana Nandy, Mrigank Dhaniwala and Eileen Soreng)
