Indian Stock Market Update: IT Stocks Fall, Inflation Concerns

2023-12-13 04:50:26

Indian benchmarks fell on Wednesday, dragged down by information technology (IT) stocks following inflation concerns sparked by US data, while Asian peers suffered losses in anticipation of the US Federal Reserve’s policy decision.

The NSE Nifty 50 index lost 0.31% to 20,840.90 points, while the S&P BSE Sensex index fell 0.32% to 69,327.07 points, at 10:16 am IST.

The information technology sector, with a weight of 13.64% in the Nifty 50, lost 1.5%. All 10 components posted losses. Tata Consultancy Services and Infosys were among the top losers in the Nifty 50, shedding between 1.5% and 2.3%.

The drop in shares of computer companies, which rely heavily on U.S. revenue, comes after the jobs market was squeezed.

data

showed a surprise month-over-month increase in the Consumer Price Index (CPI) in November.

This data has raised doubts about the possibility of a Fed rate cut in the first half of 2024.

Asian markets were lower ahead of the Fed’s policy decision, expected at 12:30 IST on Thursday.

“The Fed’s message tonight is important for global markets, which will wait for Chairman Jerome Powell’s comment before taking a decisive turn,” said VK Vijayakumar, chief investment strategist at Geojit Financial Services.

However, domestic retail inflation weaker than expected

data

and an

augmentation

in industrial production and falling global crude oil prices could continue to support Indian stocks, two analysts said.

Energy stocks gained 0.4% as Brent crude oil futures fell to six-month lows after U.S. inflation data strengthened concerns about demand amid a persistent supply glut.

A drop in oil prices benefits importers like India and its oil marketing companies. Bharat Petroleum Corporation gained 1.5% and was among the top gainers on the Nifty 50.

Laurus Labs

lost

3% after the US drug regulator issued a Form 483 with five observations following an inspection at the drugmaker’s facilities in Andhra Pradesh. (Reporting by Bharath Rajeswaran in Bengaluru; Editing by Janane Venkatraman, Sonia Cheema and Dhanya Ann Thoppil)

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