Indian Shares Extend Losses For Third Day Amid Middle East Tensions, IT Woes
(RTTNews) - Indian shares fell for a third consecutive session on Wednesday due to renewed tensions in the Gulf region and concerns over a possible interest rate hike by the U.S. Federal Reserve.
Escalating Middle East hostilities sent Brent crude prices above $100 a barrel, heightening concerns about its potential impact on rupee, inflation and corporate earnings.
After last Friday's robust August U.S. jobs report, markets now put the odds of a Federal Reserve rate hike on September 16 at about 60 percent, but the decision largely hinges on upcoming CPI and PPI inflation data.
The producer price index for August is due on Thursday, followed by the consumer price index on Friday.
As energy costs climb, the European Central Bank (ECB) is all but certain to raise interest rates by 25 basis points on Thursday.
The benchmark 30-share BSE Sensex tumbled 813.35 points, or 1.08 percent, to 74,764.23 while the NSE Nifty index fell 203.60 points, or 0.86 percent, to 23,431.50.
The BSE mid-cap and small-cap indexes ended down 0.3 percent and half a percent, respectively.
The market breadth was weak on the BSE, with 2,485 shares falling while 1,886 shares rose and 217 shares closed unchanged.
Information technology stocks led losses, with TCS, Tech Mahindra, Infosys and HCL Technologies plunging 2-5 percent, after Cognizant's U.S. immigration practices came under fresh scrutiny.
Cognizant's green card filings are now on hold in the U.S., raising costs and creating new uncertainty for Indian companies.
Among other prominent decliners, Reliance Industries, BEL, Bharti Airtel, UltraTech Cement, Bajaj Finance, Hindustan Unilever and HDFC Bank dropped 1-2 percent.
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