Sensex, Nifty Nosedive As Recession Worries Mount
(RTTNews) - Indian shares reversed course to end sharply lower on Thursday amid concerns that higher U.S. interest rates could lead to more capital outflows from emerging markets, including India.
After announcing a 75-basis point rate hike on Wednesday and leaving the door open for another rate increase of that magnitude in July, Fed Chair Jerome Powell said the central bank cannot control all the factors driving inflation.
With more rate hikes expected in the coming months, fears mounted that the Fed might trigger a recession sometime in the next year with its aggressive rate action.
Domestic stock markets opened with gains but soon reversed course to end deep in the red, tracking weak European equities and slumping U.S. stock futures.
The benchmark S&P BSE Sensex hit an intraday high 53,142.50 before reversing direction to end the session down 1,045.60 points, or 1.99 percent, at 51,495.79 on concerns about the impact of surging inflation on economic growth and corporate earnings.
Likewise, the broader NSE Nifty index fell 331.555 points, or 2.11 percent, to 15,360.60 amid the expiry of weekly F&O contracts.
Selling was seen across the board, with auto and commodity stocks bearing the brunt of the selling. Tata Motors, Coal India, ONGC, Tata Steel and Hindalco slumped 5-7 percent.
FMCG stocks such as Nestle India and Britannia Industries eked out modest gains on defensive buying.
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