Indian markets fell sharply on Wednesday, with the Bombay Stock Exchange Sensex closing 183.75 points down at 28,155.56 and the National Stock Exchange Nifty slipping 67.60 points to end at 8,724.70. The indices reacted negatively to the possibility of interest rate hike by the United States Federal Reserve, after Chairperson Janet Yellen spoke in support of such a move on Tuesday.
Shares of automobile, pharmaceutical and real estate companies were among the worst-performing stocks during morning trade. Tata Motors’ share value fell by 10%, with the stock at Rs 436.55 at closing. This came after the company posted a 96% drop in its third-quarter net profit because of losses in its overall business. Other automobile companies including Maruti Suzuki and Hero MotoCorp fell between 1.32% and 1.99%. The Nifty’s Auto Index also fell by 3.03%.
Besides Tata Motors, Sun Pharma was the other worst performer of the day, with its shares plunging 4.25% to Rs 622.50. The BSE Midcap and Smallcap indices also fell by 1.16% and 1.52%. Most companies listed on both sub-indices ended in red.
Meanwhile, Asian markets rose on the back of gains by Wall Street stocks. While Hong Kong’s Hang Seng gained 1.12%, South Korea’s Kospi and Australia’s S&P/ASX 200 gained 0.45% and 0.94%. Japan’s Nikkei 225 also gained 1.03%.
On Tuesday, Yellen had said a solid job market in the US and the strength of the country’s economy meant that the Federal Reserve was likely to resume raising its interest rate in the next few months, AP reported. She told a US Senate committee that Fed officials in December 2016 had predicted that they would raise rates at least three times in 2017. While Yellen did not rule out raising the rate at the institution’s next meeting in March, most analysts expect the move in June.
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