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BENGALURU - Indian shares closed lower on Wednesday as the country's largest private lender HDFC Bank dropped after another issue hit its banking applications, while rising U.S. Treasury yields renewed concerns of foreign fund outflows.

The blue-chip NSE Nifty 50 index fell 1.04% to 14,690.70 and the benchmark S&P BSE Sensex dropped 1.3% to 49,509.15.

The indexes gained more than 2% in the previous session and booked their second straight monthly gains.

HDFC Bank fell 3.9% on Wednesday, pulling the wider Nifty bank index 1.7% lower.

The lender said on Tuesday that some of its customers were facing issues in accessing its internet banking and mobile banking application. The issue was resolved later. (https://bit.ly/3ftN3Nl)

India's central bank in December forbid the bank from adding new credit card customers or launching digital businesses after its digital payment services were hit by a power failure.

The domestic market was also pressured by a rise in the benchmark 10-year U.S. Treasury yield, which rose to 1.776% overnight, its highest since January 2020.

Refinitiv data showed foreign investors purchased $1.51 billion worth of Indian equities in March as of Tuesday, down from $3.54 billion in February, due to higher U.S. bond yields and rising domestic coronavirus cases.

The rising yields also weighed on global stocks on Wednesday, while the safe-haven dollar held near five-month highs. [MKTS/GLOB]

Meanwhile, India's Adani Group said it condemned "violations of fundamental rights of all people" and would continue to work with "partners and stakeholders," in response to recent media reports on the conglomerate's investments in Myanmar.