Indices tumble in opening session as high inflation in US trigger sell-off
Mumbai, June 13, 2022
Domestic equity indices extended their losses from the previous week and tumbled even more sharply on Monday as high inflation in the US triggered possibilities of even more aggressive policy tightening by the Federal Reserve.
With Monday's slump, the indices have declined for six out of the last seven sessions.
At 9.42 a.m., the BSE Sensex was 2.7 per cent or 1,462 points down at 52,842 points, whereas the NSE Nifty was 2.6 per cent or 419 points down at 15,782 points.
"The near-term market trend is weak. The May US inflation print at 8.6 per cent against the market expectation of 8.3 per cent is likely to turn the Fed more hawkish with a series of 50 bp rate hikes taking the terminal rate by mid 2023 above 3.5 per cent. Such a scenario would be negative for risky assets like equity, particularly in the context of declining global growth," said V. K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Most other Asian stocks also declined on Monday.