BENGALURU, Dec 23 (Reuters) -
India's benchmark Nifty 50 stocks index slipped below the 18,000 mark on Friday after robust U.S. economic data revived concerns of higher interest rates, while a surge in COVID-19 infections in China also dampened risk appetite.
The Nifty 50 index was down 0.95% at 17,951.20 as of 11:15 a.m. IST, dropping below the 18,000 mark for the first time since Nov. 10. The S&P BSE Sensex fell 0.90% at 60,279.44.
Both benchmarks are on course for their fourth straight session of declines, the longest such losing streak in nearly three months. They are also on track for their worst week in over six months since June 17.
Wall Street fell sharply overnight after upbeat GDP data and a resilient job market fuelled fears that the Federal Reserve could raise rates further and for a longer period to tackle inflation.
The mood was soured further by surging COVID-19 cases in China that could lead to more disruptions to the economy in the short term.
Among Indian stocks, the pharma index was the lone gainer, rising 0.6% on news that India is ready to step up exports of fever medicines to China.
The pharma index has outperformed the markets this week, rising 2.6% compared to a 1.8% fall for the Nifty 50.
But analysts said it was unlikely there would be a repeat of the pharma rally seen during the previous waves of COVID-19.
"It's unwise to chase pharma stocks just on hopes that they will do very well because COVID-19 is coming back," said Neeraj Dewan, director, Quantum Securities. The "fear of the unknown" that caused the correction in 2020 is not prevalent anymore, he added.
Deven Choksey, managing director at KRChoksey Holdings, said the pharma rally will most likely be a short-term phenomenon, noting that many diagnostics stocks were trading at high valuations.
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Eileen Soreng and Saumyadeb Chakrabarty)
