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Nifty, Sensex fall after Fed signals faster tightening pace

Reuters 

By Jessica Kuruthukulangara

(Reuters) - Indian shares fell on Thursday, in line with Asian peers, as the Federal Reserve raised U.S. interest rates and struck a more hawkish tone in forecasting a slightly faster pace of tightening.

Asian shares dropped after the Fed raised its benchmark overnight lending rate to a range of 1.75 percent to 2 percent and forecast two additional hikes by the end of this year, compared to one previously. MSCI's broadest index of shares outside fell 1.16 percent.

"People are a bit nervous because of the Fed's hawkish tone and since the Fed may increase the pace of tightening. Moreover, there is an overhang from the (ECB) policy as all these central banks are on the reverse course now," said Saurabh Jain, AVP - Research,

The ECB at its meeting on Thursday will debate whether to end a massive bond purchase scheme later this year, taking its biggest step yet in dismantling crisis-era stimulus credited with reviving growth after a double-dip recession.

India's broader NSE Nifty was down 0.62 percent at 10,789.90 as of 0611 GMT, while the benchmark BSE Sensex was 0.58 percent lower at 35,531.58. The indexes were set to snap a three-session gaining run.

The index fell as much as 1.5 percent and was on track to end a six-session winning streak. lost 2.6 percent.

Lenders also fell, with the retreating 2.1 percent. The Nifty PSU lost as much as 1.9 percent, after gaining in the last six sessions.

ICICI Prudential Co Ltd dropped as much as 2.9 percent after said it would sell a 2 percent stake in the insurer.

dropped as much as 3.6 percent after the said it would offer shares to institutional investors.

Meanwhile, shares of Ruchi Soya Industries Ltd, which has been undergoing an insolvency resolution process since December, climbed 4.7 percent to hit their upper price limit after the said its committee of lenders declared as top bidder for the company.

(Reporting by in Bengaluru; Editing by Amrutha Gayathri)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, June 14 2018. 11:53 IST
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