India's Nifty 50 closes at 5-month low on elevated oil prices, bond yields
Indian shares fell on Tuesday on concerns over elevated oil prices and global bond yields ahead of this week’s Federal Reserve meeting, while gains in IT and the country’s largest private lender, HDFC Bank, limited losses. The benchmark Nifty 50 ended 1.19% lower at 23,118.6, its lowest close in five months, and the BSE Sensex shed 1.04% to 74,003.82. The indexes had opened about 0.8% higher…
Indian shares fell on Tuesday amid concerns over high oil prices, rising global bond yields, and the upcoming Federal Reserve meeting. The benchmark Nifty 50 closed 1.19% lower at 23,118.6, marking its lowest level in five months, while the BSE Sensex dropped 1.04% to 74,003.82. The indexes had opened around 0.8% higher after declining 4.8% over the past five weeks.
The 50-stock index experienced a brief decline of about 2.2% during the closing auction session, extending losses of 0.96% after the end of regular trading at 3:15 p.m. IST. Out of the 16 major sectors, 15 sectors witnessed losses, with small-caps and mid-caps falling 2.4% and 2.1%, respectively. Brent crude futures surged 2% to $107.8 per barrel due to intensifying Middle East tensions.
Yemen's Iran-aligned Houthis launched fresh attacks on Saudi Arabia and advanced further into positions along Yemen's western coast on the Red Sea. Meanwhile, sovereign yields climbed higher, led by the 10-year U.S. Treasury yield, which reached a near two-decade high, reflecting growing unease among borrowers and global investors.
The Federal Reserve is expected to raise interest rates during its meeting this week, driven by mounting inflationary pressures. Arun Malhotra, a fund manager at CapGrow Capital, believes that the current market weakness is largely attributed to elevated oil prices, surging treasury yields, and a pipeline of significant initial public offerings (IPOs).
If the U.S. hikes interest rates, India is likely to follow suit to safeguard its currency. Financials and auto stocks fell 1.8% and 2%, respectively, while IT stocks gained 2.2% following calls for a slowdown in AI development. India's largest software services companies, Tata Consultancy Services and Infosys, rose 2.3% and 3.8%, respectively.
Despite the IT sector's lag over the past year due to potential disruptions from new AI tools, HDFC Bank rose 1.2% after naming two candidates for its CEO position to the central bank.
Written by urgent.news from Business Recorder's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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