HDFC Bank drags down Indian shares

Indian shares fell to their lowest since mid-May on Monday, dragged by banking bellwether HDFC Bank Ltd after it reported a slowdown in loan growth and a hit to asset quality.

The broader NSE index was down 0.7 per cent at 11,344.5 as of 0446 GMT, while the benchmark BSE index was 0.76 per cent lower at 38,044.83.

The bourses appeared to be heading for their third straight session of losses, reports Reuters.

Broader Asian stocks were under pressure too as investors trimmed expectations of an aggressive US interest rate cut.

However, oil prices climbed after tensions in the Middle East escalated and Libya reported the shutdown of its largest oil field.

HDFC Bank, India’s largest lender by market capitalisation, dropped as much as 3.1 per cent to its lowest since May 16 and was among the top drags on the indexes.

Housing Development Finance Corporation Ltd, HDFC Bank’s biggest shareholder, dropped 4.1 per cent in its sharpest intraday fall since October and was the top percentage loser on the indexes.

Shares of HDFC Bank’s smaller rival Kotak Mahindra Bank Ltd fell as much as 2.2 per cent ahead of quarterly results.

The Nifty Bank index dropped as much as 1.7 per cent.

Meanwhile, Yes Bank Ltd snapped three sessions of losses to trade 8.7 per cent higher. The stock was the top gainer on the indexes.

Conglomerate Reliance Industries Ltd rose as much as 1.6 per cent after posting a 7.0 per cent rise in quarterly profit.

It saw a double-digit growth in its retail and telecoms businesses offsetting its worst oil refining margins in 18 quarters.

Miner Vedanta Ltd climbed as much as 4.7 per cent.