BENGALURU: Indian shares opened lower on Monday, dragged down by IT services companies, after a strong U.S. jobs report renewed fears that the Federal Reserve was likely to continue with aggressive rate hikes for longer.
An ongoing selloff in Adani Group stocks further pressured domestic equities, dragging the Nifty 50 index down 0.39% to 17,784.50, while the S&P BSE Sensex lost 0.25% to 60,577.20, as of 09:45 a.m. IST.
Wall Street equities fell on Friday after nonfarm payrolls rose by 517,000 jobs in January, way above a Reuters estimate of 185,000.
India’s Adani shares see extended sell-off as credit warnings kick in
The strong report heightened fears that the Fed might continue its rate hike trajectory, with interest rate futures now pointing to chances of the central bank delivering at least two more rate hikes.
Indian information technology stocks fell over 1.1%, with nine of the 10 constituents logging losses on rate-hike concerns in the U.S.
IT companies in the country count some of the biggest U.S. firms as their clients. Any potential slowdown in the world’s largest economy typically has an adverse impact on the companies’ growth prospects.
Meanwhile, analysts said that the selloff in Adani stocks had created panic in Indian markets. Ratings agency Moody’s warned that the tumble in Adani group stocks could hit the conglomerate’s ability to raise capital.
Thirty nine of Nifty 50 constituents declined, with Adani Enterprises falling the most while ITC and State Bank of India advanced after reporting better-than-expected rise in net profit in third quarter, post market hours on Friday.
Asian markets too slid on Monday, with the MSCI’s broadest index of Asia-Pacific shares outside Japan shedding 1.83%.
Comments
Comments are closed.