Sensex, Nifty snap gains over North Korea tensions
People walk pass the Bombay Stock Exchange (BSE) building displaying India's benchmark share index on its facade, in Mumbai. Photograph: (Reuters)
Indian shares fell on Monday in line with Asian markets as North Korea's latest nuclear test prompted investors to seek refuge in safe havens such as gold.
North Korea on Sunday conducted its sixth and most powerful nuclear test, which it said was of an advanced hydrogen bomb for a long-range missile, marking a dramatic escalation of the regime's stand-off with the United States and its allies.
Japan's Nikkei closed about 1 per cent lower, while MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.8 per cent.
"The markets are struggling to go up because of North Korea tensions," said Deven Choksey, promoter, KR Choksey.
The broader Nifty was down 0.97 per cent at9,877.70 as of 0637 GMT, while the benchmark Sensex was 0.87 per cent lower at 31,613.89.
Technical charts showed the NSE index broke out of a triangle formation last week, suggesting consolidation was complete and a rally might resume.
"Banking stocks such as HDFC Bank are a bit highly valued and are seeing some corrections," Choksey said.
HDFC Bank and Housing Development Finance Corp were down for a second straight session, trading 0.9 per cent and 0.7 per cent lower respectively.
The Nifty Auto index fell 0.8 per cent after gaining nearly 2 per cent on Friday when most automakers reported August sales numbers. Hero MotoCorp, which reported a 10 per cent rise in sales, was trading 1.6 per cent lower.
Meanwhile, Coal India surged as much as 2.9 per cent after the miner said on Friday that the company along with its units produced 37.63 million tonnes of coal in August, beating its target of 36.96 million tonnes.