Markets take a breather; global stocks slide on Fed rate hike

A view of the BSE building in Mumbai.

A view of the BSE building in Mumbai.   | Photo Credit: Reuters

Sensex 52.66 points lower at 36,431.67; NSE Nifty slipped 15.60 points to 10,951.70

Snapping a seven-day rising streak, equity benchmarks finished with mild losses on Thursday amid a broad reversal across global markets following Fed’s rate hike.

The BSE Sensex, which had dropped more than 250 points in morning trade, finally finished 52.66 points, or 0.14%, lower at 36,431.67.

The broader NSE Nifty slipped 15.60 points, or 0.14%, to 10,951.70.

World markets tumbled after the U.S. Federal Reserve raised its key interest rate for the fourth time this year, and signalled more next year, albeit at a slower pace than expected. The quarter-point increase, to 2.25-2.5%, lifted the Fed’s key rate to its highest point since 2008.

A rebound in the rupee and softening crude oil prices cushioned the fall for the domestic markets, traders said.

Major gainers in the Sensex pack were Yes Bank, Hero MotoCorp, M&M, Asian Paints, Sun Pharma, Tata Motors, L&T and HDFC Bank, rising up to 3.93%.

Losers included Bharti Airtel, SBI, Wipro, Vedanta, Maruti Suzuki, ICICI Bank, Axis Bank and Reliance Industries, falling up to 2.18%.

PSU bank stocks were the biggest losers on both exchanges, after the government sought Parliament’s approval for additional gross expenditure of ₹85,948.86 crore, about half of which is for capital infusion in public sector banks through recapitalisation bonds, during the current fiscal.

On a net basis, foreign portfolio investors (FPIs) bought shares worth ₹1,209.21 crore on December 19, and domestic institutional investors (DIIs) were net sellers to the tune of ₹481.46 crore, provisional data available with BSE showed.

Globally, the Fed’s move came despite U.S. President Donald Trump’s attacks in the recent weeks on its rate hikes and on Chairman Jerome Powell personally. The President had complained that the moves are threatening the economy.

At a news conference after the Fed’s announcement, Mr. Powell said Mr. Trump’s tweets and statements would have no bearing on the central bank’s policymaking.

Elsewhere in Asia, Korea’s Kospi fell 0.90%, Japan’s Nikkei plunged 2.84%, Hong Kong’s Hang Seng shed 0.94% and Shanghai Composite Index slipped 0.52%.

In Europe, Frankfurt’s DAX fell 0.84% and Paris’ CAC 40 shed 1.33% in their early deals. London’s FTSE too slipped 0.84%.

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Printable version | Mar 28, 2020 2:58:44 PM |

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