India stocks halt 4-day rally as data shows recovery woes

Bloomberg

Indian equities declined, halting their longest run of gains in three weeks, as economic growth concerns resurfaced amid a steady increase in new infections.
The S&P BSE Sensex falls 0.4% to 38,244.45 as of 9:40 am in Mumbai, after rising for four straight sessions. The NSE Nifty 50 Index also declined by a similar magnitude.
The nation’s factory output slid for a fourth month in June as the economy struggled to reopen amid the still-spreading pandemic, according to government data released after market hours. High-frequency indicators from purchasing managers’ surveys to fuel sales also show activity levelling off in July.
“The factory output data suggests that we are still a long way from recovery,” said Anita Gandhi, an investment adviser at Arihant Capital Markets Ltd. in Mumbai. “The recent gains has also prompted investors to book profit.”
The Sensex has surged more than 45% from its March lows in one of the best rebounds globally from the depths of the selloff. The rebound has made shares expensive, with the gauge’s blended forward 12-month price-to-earnings ratio trading two standard deviations above the 10-year average, data compiled by Bloomberg show.
As earnings continue, 25 of the 38 Nifty 50-member companies that have announced results so far have beaten or matched estimates.
The rupee weakened 0.1% to 74.8350 per US dollar, while the yield on 10-year government bonds rose 2 basis points to 5.92%.