Sensex edges down on global growth worries; Tata Steel drags

REUTERS - Indian shares edged down on Wednesday, heading for their third straight session of declines, led by miners such as Tata Steel Ltd on widening quarterly loss, and on renewed concerns over the ability of global central banks to prop up growth.

Asian stocks wallowed near six-week lows, with Japan's Nikkei <.N225> falling 0.69 percent as uncertainty grew ahead of a central bank policy meeting next week.

Markets have been under pressure as talks gathered momentum that the U.S. Federal Reserve could raise rates at its policy meeting next week and on uncertainty over the European Central Bank's future policy steps.

 

"Global growth concerns are still there and many are of the opinion that a 1 to 2 percent global growth would continue to be there for some time before seeing some recovery," said Saurabh Jain, assistant vice president of research at SMC Global Securities.

The broader NSE Nifty fell as much as 0.31 percent to 8,688.9, its lowest in two weeks, while the benchmark BSE Sensex declined up to 0.33 percent to 28,259.38.

Indian stock markets were closed on Sept. 13 for a public holiday.

The NSE volatility index, a key gauge to measure investors' fear, rose to its highest since Aug. 4 on Wednesday and was last up 0.87 percent. It jumped about 15 percent in the last session.

Among the losers, Coal India Ltd's shares fell as much as 2.71 percent after the company reported a 15 percent fall in its first-quarter profit.

Tata Steel Ltd declined as much as 2.72 percent to its lowest in a month after reporting a wider first-quarter loss on sale of a business in Europe.

However, banking stocks witnessed a bit of recovery after data released late on Monday showed consumer inflation fell to a five-month low in August, raising hopes of an interest rate cut next month.

The Nifty Bank Index was up 0.44 percent after falling 3 percent in the previous two sessions.

State Bank of India rose 1.27 percent, ICICI Bank gained 1.06 percent, and Axis Bank climbed 1.1 percent.

(Reporting by Samantha Kareen Nair in Bengaluru; Editing by Subhranshu Sahu)