Sensex, Nifty fall for second day as higher inflation dashes rate cut hopes
NEW DELHI: Domestic equity market extended losses for a second straight session on Tuesday, as expectations of the RBI cutting interest rates next month were dampened after inflation picked up in October. Meanwhile, subdued Asian markets also impacted market mood.
The BSE Sensex closed 91.69 points, or 0.28 per cent, down at 32,941.87 on Tuesday, while NSE Nifty index settled 38.35 points, or 0.38 per cent, down at 10,186.60.
Aditi Nayar, Principal Economist, ICRA said, “The sharper-than-anticipated uptick in the WPI inflation reinforces our expectation of a status quo in the upcoming monetary policy review.” Inflation at the wholesale level rose to 6-month high of 3.59 per cent in October as the prices of food articles, led by onions and vegetables, rose sharply.
As many as 32 stocks in Nifty index closed in red with Bharti Infratel falling the most 5 per cent, followed by Indian Oil Corporation (down 2.48 per cent), Larsen & Toubro (down 2.38 per cent), HPCL (down 2.27 per cent) and Vedanta (down 2.07 per cent).
Shares of Bharti Infratel slipped after reports that Bharti Airtel has sold stake in the company via block deals.
Jaiprakash Associates tumbled over 7 per cent in Tuesday’s trade after the Supreme Court directed its non-institutional directors to appear in person before it next week and furnish details of their personal assets.
On the other hand, Hero MotoCorp, Axis Bank, Reliance Industries, Bajaj Auto and Bajaj Finance advanced 2.10 per cent, 1.91 per cent, 1.40 per cent, 1.40 per cent and 1.34 per cent, respectively.
Karthikraj Lakshmanan, Senior Fund Manager – Equities, BNP Paribas Mutual Fund said, “It was a lacklustre day on the bourses as key benchmark indices in India traded under pressure taking cues from subdued trading activity in global stocks. Macro-economic data, showing a risk in India’s inflation last month also added to investor worries.”
Most of the sectoal indices on BSE also closed in red. The BSE Capital Goods and Telecom and Oil & Gas index tumbed 1.41 per cent, 1.26 per cent and 0.88 per cent, respectively. The BSE Realty and BSE Consumer Durables advanced 0.74 per cent and 0.64 per cent, respectively.
Asian peers Hang Seng and Shanghai closed lower by 0.10 per cent and 0.53 per cent, respectively.
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Via:: Economic Times – Stocks