While stock indices continue to fall as the crisis in Iraq is deepening, the rupee weakened further following fears of rising inflation and widening Current Account Deficit (CAD).
The S&P BSE Sensex closed at 25105.51 with a loss of 96.29 points. While the broader BSE-100 lost 0.39 per cent, the mid-cap and small-cap stocks dipped by 0.39 per cent and 0.83 per cent, respectively.
On the National Stock Exchange (NSE), the 50-share Nifty lost 29.25 points to close at 7511.45.
“Global markets, including Indian markets were a bit cautious on the back of Iraq issue and consequent rise in global oil prices. Indian currency also weakened as a consequence of this,” said Sudip Bandyopadhyay, Managing Director and CEO of Destimoney Securities.
The rupee lost 10 paise to close at 60.18 against its previous close of 60.08 a dollar. After opening at 60.21, the rupee touched an intra-day low of 60.32.
The increase in crude oil prices indicates further inflationary pressure. Brent crude rose to around $115 a barrel. Higher dollar demand by oil companies also impacted the rupee.
“The Indian markets were range-bound and generally cyclicals such as metal, banks and infrastructure were under pressure. The defensives, like pharmaceuticals and information technology went up.