The benchmark index of the equities markets fell over 55 points in early trade on Tuesday on profit-booking by funds and retail investors, as growing inflation greyed hopes of a rate cut by the Reserve Bank of India.
The benchmark index of the equities markets fell over 55 points in early trade on Tuesday on profit-booking by funds and retail investors, as growing inflation greyed hopes of a rate cut by the Reserve Bank of India.
Reportedly, the 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE) fell by 55.25 points, or 0.28%, to 19,687.22 in early trade with shares of banking, capital goods, FMCG and realty topping the falling list.
Sensex had gained 9.71 points in the previous session.
Likewise, the wide-based National Stock Exchange index Nifty declined by 19.40 points, or 0.33%, to 5,821.15.
According to reports, the brokers said that selling by funds as well as retail investors after rise in August wholesale inflation ruined hopes of RBI cutting rates later this week and the fears ahead of the US Federal Reserve’s policy meeting has majorly contributed to the rupee fall.
The Fed is slated to hold a policy meeting on Tuesday and Wednesday, in which it is likely to trim down its $85 billion a month bond-buying programme, but financial markets are unsure about the amount of the reduction.
Once the Fed reduces its stimulus programme, India, along with other emerging markets, will witness decrease in capital inflows and the impact has already started to show with the rupee’s slump.
The US Dow Jones Industrial Average ended 0.77% higher in yesterday’s trade.
