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Indian shares are set to open lower on Wednesday as a sharp rise in July domestic inflation hurt sentiment, while global peers fell on interest rate concerns in the U.S. and worries over China's economy.

India's GIFT Nifty on the NSE International Exchange was down 0.40% at 19,396.00 at 7:59 a.m. IST.

India's annual retail inflation rose to a 15-month high of 7.44% in July, predominantly due to rising vegetable and cereals prices also dragged sentiment.

The figures breached the upper end of the Reserve Bank of India's tolerance band of 2%-6% for the first time in five months.

In the ongoing July-September quarter, the RBI now sees inflation at 6.2%, significantly higher than the earlier forecast of 5.2%.

Meanwhile, Wall Street equities fell overnight after stronger-than-expected retail sales data triggered concerns that the U.S. Federal Reserve may have room for further rate hikes.

Asian markets declined on Wednesday, on worries over China's economic recovery a day after the country's central bank unexpectedly cut rates for the second time in three months. [MKTS/GLOB]

Foreign institutional investors (FIIs) sold Indian shares for the second straight session on Monday, offloading 23.24 billion rupees ($278.6 million), while domestic institutional investors (DIIs) bought shares worth 14.61 billion rupees, according to provisional National Stock Exchange (NSE)data.

STOCKS TO WATCH:

** ITC: Co's June quarter profit view tops estimates on lower costs, better demand.

** Infosys: Co signs $1.64 billion deal with video, broadband and communications firm Liberty Global to scale digital platforms.

** Vodafone Idea: Co secures $240 million to meet payment obligations, reports wider June quarter loss on weak 4G subscriber growth.

** Ashok Leyland: Co receives board approval to buy 100% stake in OHM Global Mobility, says it will invest 3 billion rupees as equity into OHM to operationalise the company.

($1 = 83.4150 Indian rupees)