Stock Market Update: Fears that the U.S. Federal Reserve will continue its policy of aggressivity rate hikes caused Indian shares to close lower on Friday, recording their first weekly decline in five weeks.
The benchmark NSE Nifty 50 index down 0.2% to 18,307.65, and the S&P BSE Sensex fell 0.14% to 61,663.48. For the week, they decreased by around 0.2%.
U.S. inflation data
Following relatively weak U.S. inflation statistics released last week, which revived bets for lower rate hikes, both indices had increased by more than 2%.
However, they have decreased by about 0.75% over the last two sessions as more Fed officials have issued cautionary statements regarding interest rates. On Friday, global stocks were projected to lose 1% for the week.
Indian stock markets are overbought.
“Asian markets are under pressure, and Indian markets are in a profit-taking zone due to geopolitical uncertainties and the Fed’s renewed hawkishness “said Prashanth Tapse, Mehta Equities’ vice president of research.
The markets will trade sideways until the following Fed rate decision in early December as corporate results are largely finished, according to Tapse.
Late on Thursday, James Bullard of the St. Louis Fed and Neel Kashkari of the Minneapolis Fed Bank argued in favour of additional rate increases to combat inflation.
Participation by international investors is another factor contributing to the current performance of Indian markets.
Stock Market Update: Conclusion
According to Refinitiv statistics, they have made net equity purchases of $3.52 billion so far this month, compared to marginal withdrawals of $0.52 million in October.
Bajaj Healthcare had a rise in its shares of up to 7.5% after finishing the pre-approval examination of its Gujarat plant by the U.S. health authorities, and Honda India Power experienced a record high in a post-results rally.
The auto index was a top drag, falling 1.2%, while the public sector bank index increased 1.5%.
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