Indian shares continue slide on rate jitters ahead of Fed, RBI minutes

All the 13 major sectoral indexes fell, with the heavyweight financials dropping 1.76%

The Bombay Stock Exchange. The S&P BSE Sensex fell 1.53 per cent at 59,744.98 on Wednesday.- AP

By Reuters

Published: Wed 22 Feb 2023, 3:35 PM

Last updated: Wed 22 Feb 2023, 5:03 PM

Indian shares fell for the fourth session in a row on Wednesday and recorded their worst day in over three weeks after strong U.S. data fuelled worries about higher-for-longer interest rates.

The Nifty 50 index closed down 1.53 per cent at 17,554.30, its lowest in over four months. The S&P BSE Sensex fell 1.53 per cent at 59,744.98.

Wall Street posted its worst one-day slump of the year on Tuesday after U.S. business activity returned to expansion for the first time in eight months in February, fuelling fears of continued high rates.

Those worries remain in focus ahead of the release, later in the day, of the minutes of the latest meetings of the US Federal Reserve as well as the Reserve Bank of India.

“The probability of impending rate hikes by the U.S. Fed has risen from two to three, in the light of new data,” said Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services. “Fear of a hawkish Fed has gripped markets and kept investors on tenterhooks.”

All the 13 major sectoral indexes fell, with the heavyweight financials dropping 1.76 per cent and information technology losing more than 1 per cent.

Metals tumbled 2.64 per cent to their worst day in nearly three weeks due to a dip in metal prices and a 10.58 per cent drop in Adani Enterprises.

Forty-eight of the Nifty 50 constituents declined. Reliance Industries and HDFC Bank, the two most heavily weighted stocks on the index, lost 2.27 per cent and 1.96 per cent, respectively.

Among individual stocks, Wockhardt bucked the broader trend to jump 1.24 per cent after the company said a business restructuring will help it save $12 million annually.

Separately, the National Stock Exchange extended trading hours for interest rate derivatives to 5 p.m. IST from Feb. 23, to help investors better hedge risks with global equities.