Indian shares log worst week since late Oct as financials extend losses

BENGALURU, Jan 25 (Reuters) - Indian shares declined on Thursday, dragged by information technology stocks (IT) following disappointing results from Tech Mahindra and as financial stocks continued to retreat.

The blue-chip NSE Nifty 50 index fell 0.47% to 21,352.60 points and the S&P BSE Sensex lost 0.51% at 70,700.67.

They have fallen about 1.3% each over the three sessions this holiday-truncated week, logging their worst performance since the week ending 27 October. The market is closed on Friday on the occasion of Republic Day.

High-weightage financials led the losses for a second straight week, adding 1.6% to their 4.1% drop last week that was sparked by HDFC Bank reporting disappointing margins.

In the six sessions since then, foreign funds have sold Indian shares worth ₹34,766 crore ($4.18 billion), pulling the Nifty 50 down about 3%.

HDFC Bank's results also brought margin concerns in the sector to the fore, which has hurt sentiment and spurred FII selling.

Media stocks tumbled 9.93% this week, the most since March 2020 when the COVID-19 pandemic triggered a global sell-off.

The main reason this time was the 30.55% plunge in Zee Entertainment, its biggest weekly fall ever, after its $10 billion merger with Sony's local unit collapsed.