In the lead-up to the U.S. Federal Reserve’s policy announcement later this week, a decline in information technology (IT) companies caused Indian shares to fall on Tuesday, mirroring the weakness in the larger Asian market.
As part of its plan to wind down its stimulus programme, the Bank of Japan modified its bond yield control policy, loosening its hold on long-term interest rates. This caused Asian markets to fall.
Seven out of the thirteen key sectoral indices saw gains on the domestic front.
Before the Fed’s policy announcement, which is expected on Wednesday after the bell, IT stocks fell by 0.5%.
The Fed’s remarks on future rate trajectory and inflation management might have an impact on domestic equities generally and IT companies specifically, even though it is largely predicted that rates would remain steady. A sizable portion of IT businesses’ income comes from the United States.
Over 1.5% was added to the price of real estate equities, with DLF and Macrotech Developers seeing the biggest gains on the strength of their outstanding quarterly results and strong housing market.
Rising 0.6% and 0.8%, respectively, the mid- and small-cap indices beat the benchmarks.
According to Varun Saboo, head of equities at Anand Rathi Shares & Stock Brokers, “the slide earlier in the month has almost eliminated most of the froth in the markets, especially in the mid-cap segment.”
Due to supply worries resulting from the Middle East crisis, Brent oil futures saw a 3% decline in the previous day before rising to $88 per barrel on Tuesday. Growing oil costs are detrimental to countries like India that import the commodity. (O/R)
With 2.63% of the Nifty 50 lost so far in October, it is expected to be the worst month since January. The amount of shares sold by foreign investors in October has reached 228.50 billion rupees ($2.74 billion), the highest since January.