Indian Shares Fall After RBI Rate Hike
(RTTNews) - Indian shares fell notably on Wednesday after two days of gains amid diminished expectations for another Federal Reserve interest-rate hike in October.
A cautious undertone prevailed as Brent crude prices jumped toward $102 a barrel on fears Iran is stepping up attacks on tankers in the Strait of Hormuz. The U.S. dollar strengthened and global bonds rebounded as investors refocused on France's deepening fiscal crisis.
Meanwhile, adding to investor concerns over a weakening rupee and continued foreign selling, the Reserve Bank of India (RBI) today raised its benchmark interest rates by 25 basis points and changed its monetary policy stance to calibrated tightening.
After delivering the first repo rate hike in nearly four years, the RBI said rate cuts are off the table in the near term and policy action ahead can only be a rate hike or a pause, depending on the evolving conditions and the outlook.
The benchmark 30-share BSE Sensex fell 429.11 points, or 0.59 percent, to 72,638.70 while the NSE Nifty index dropped 173.05 points, or 0.76 percent, to close at 22,603.05.
While the BSE mid-cap index fell 0.6 percent, the small-cap index ended little changed.
The market breadth was weak on the BSE, with 2,353 shares falling while 2,018 shares rose and 243 shares closed unchanged.
Among the prominent decliners, Titan Company shares tumbled 3.5 percent after the company's July-September quarter jewelry growth fell short of expectations.
HCL Technologies, Mahindra & Mahindra, Tata Steel, Adani Ports, Larsen & Toubro, Infosys, Asian Paints and BEL all fell around 2 percent.
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