Indian shares drop, tech stocks hammered as Fed awaited
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Indian shares closed lower on Tuesday, with technology stocks bearing the brunt as investors turned wary of a likely sharp hike in U.S interest rate this week.
The NSE Nifty 50 index lost 0.88% to 16,483.85, with a similar drop in S&P BSE Sensex to 55,268.49.
"While global growth has clearly entered a slower lane, including rising fears of U.S. recession, we look at several early anecdotes indicating possible worsening of domestic demand outlook," BofA Securities said in a note released Tuesday.
There are several emerging risks, including slowing growth, adverse policy interventions, FX depreciation and rising rates, BofA said, adding that earnings cuts were "imminent".
While Asian shares gained on new Chinese plans to tackle its property crisis, Europe was subdued ahead of a likely 75 basis points Federal Reserve interest rate increase on Wednesday amid mounting worries of a gas crunch. [MKTS/GLOB]
In India,equities received a net $52.95 million of inflows this month, up to Monday, after heavy foreign outflows every month since November. For the month so far, the Nifty and the Sensex are up about 4.5% each.
Private lender Axis Bank slid 2.9% on its worst day since mid-May despite a beat on quarterly profit, as analysts flagged soft loan growth.
The Nifty IT index slid 2.8% and was the worst performer among sub-indexes, with IT major Infosys dropping 3.5%.
Food delivery firm Zomato tumbled 12.5% to a record low, fintech firm Paytm slid 7.8%, while online insurance platform PB Fintech dropped 4.1%.
Software company Ramco Systems plunged 11.1% after the company said its quarterly loss widened.
Financial services provider Bajaj Finserv cushioned some losses on the Nifty 50, adding 5.5%, after announcing plans to issue bonus shares and split stock.
