Sensex extends losses as Fed’s taper talk trips world markets

| | Mumbai
  • 0

Sensex extends losses as Fed’s taper talk trips world markets

Friday, 18 June 2021 | PTI | Mumbai

Sensex extends losses as Fed’s taper talk trips world markets

Domestic equity benchmarks retreated for  the second straight session on Thursday, mirroring weakness in global  markets  after the US Federal Reserve surprised investors by signalling  faster-than-expected rate hikes.

 A sharp drop in the rupee - which plunged 76 paise against the  US dollar - also sapped risk appetite, traders said.

 The 30-share BSE Sensex ended 178.65 points or 0.34 per cent lower  at 52,323.33. The broader NSE Nifty declined 76.15 points or 0.48  per cent to 15,691.40.

Banking and finance stocks accounted for most of the losses, while  the IT pack saw brisk buying, fuelled by a weak rupee.

 IndusInd Bank was the top loser in the Sensex pack, shedding 2.91  per cent, followed by Dr Reddy’s, NTPC, Maruti, Bajaj Auto, Axis  Bank, Bharti Airtel and HDFC.

 On the other hand, UltraTech Cement, Asian Paints, TCS, Infosys,  Tech Mahindra and HCL Tech were among the major gainers, spurting  up to 1.86 per cent.

“Domestic equities traded weak today on account of weak global  cues led from the FOMC meeting outcome as investors focused more  on the US Federal Reserve raising the country’s economic growth forecast  while noting its projection to hike interest rates sooner than expected.

 “The Fed raised the US growth forecast to 7 per cent this year,  while officials moved their first projected rate increases from 2024  into 2023 and opened talks about when to pull back on the USD 120  billion in monthly bond purchase program,” said Vikas Jain, Senior  Research Analyst at Reliance Securities.

 Vinod Nair, Head of Research at Geojit Financial Services, said a fast normalisation of the US economy and strong job market can lead to the Fed tapering its bond buying.

 “This can lead to tightening of bonds yields which will impact the pricing of equity asset,” he added.

Sectorally, BSE power, metal, realty, industrials and utilities indices ended up to 2.38 per cent lower, while IT, teck and FMCG indices closed with gains. Broader BSE midcap and smallcap indices fell up to 1.29 per cent.

 Elsewhere in Asia, bourses in Shanghai and Hong Kong ended on a positive note, while Seoul and Tokyo were in the red.

Stock exchanges in Europe were also trading with losses in mid-session deals.

Sunday Edition

Pandemic: A Triple-Whammy for Parents

26 September 2021 | RamG Vallath | Agenda

Attached to none

26 September 2021 | Hingori | Agenda

Turn to art for progress

26 September 2021 | Aarrti Zaveri | Agenda

God is easily pleased

26 September 2021 | Ajit Kumar Bishnoi | Agenda

Astroturf : Living in demanding mode

26 September 2021 | Bharat Bhushan Padmadeo | Agenda

Meet India’s young writers

26 September 2021 | Shalini Saksena | Sunday Pioneer