Stock indices dipped on Thursday after the U.S. Federal Reserve indicated that it would implement the tapering of its stimulus programme earlier than expected, a signal that also rattled currencies in emerging markets.

The rupee closed at 62.93 per dollar compared to its previous close of 62.57 on Wednesday.

The Bombay Stock Exchange (BSE) 30-share sensitive index (Sensex) closed at 20229.05 with a loss of 406.08 points . The Sensex also touched a low of 20189.23 in the trading session.

On the National Stock Exchange (NSE), a broader 50-share Nifty was down by 123.85 points . It also touched an intra-day low of 5985.40.

“The Sensex fell by more than 400 points on fresh fears that the U.S. Federal Reserve may begin tapering its quantitative easing (QE) programme earlier than expected,” said Raghu Kumar, Cofounder, RKSV, a leading broking firm.

The FOMC minutes released on Wednesday indicated that, sometime in the coming months, the Fed is looking to taper down its $85 billion in monthly bond buying due to new economic data that suggests that the employment situation in the U.S. is improving.

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