Indian shares traded in the United States posted their worst decline in eight months on Friday as Infosys nose-dived after a disappointing revenue outlook cast a long shadow over the broader view for corporate profits. The forecast from India's No 2 software services exporter was due to an uncertain global economy and ties into renewed worries about euro zone stability and the growth outlook for the global economy in general.
The results come as India's economic growth likely slowed to a three-year low of 6.9 percent after the central bank hiked rates to cool inflation. Headline inflation data for March is due on Monday. The RBI is expected to cut interest rates on Tuesday for the first time in three years.
The BNY Mellon index of leading Indian American depository receipts fell 6.5 percent, its steepest daily drop since lat August. The BNY Mellon market-wide ADR index fell 1.8 percent while the S&P 500 dropped 1.3 percent. Weaker-than-expected growth in China and surging yields on government debt in Spain weighed on the overall market.
The cost of insuring Spanish debt against default hit 500 basis points for the first time, while data showed China's economy growth slowed to 8.1 percent in the first quarter. Chinese shares held up relatively well after the local market rose as investors took the weaker growth data as a sign that the Chinese authorities may ease monetary conditions. The BNY index of Chinese ADRs fell 0.8 percent. Banks led European shares lower. The BNY Mellon index of leading European ADRs fell 2.1 percent, while the FTSEurofirst 300 index of top shares closed down 1.6 percent. Spain's Banco Santander fell 4.5 percent to $6.40, its lowest level since 2009.
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