India Stock markets crash again : Fear of slow economic growth
Indian Stock market indexes Sensex and Nifty dropped around 2 per cent and were set for their worst week since November. Investors anticipate that fast-paced interest rate hikes to tame surging inflation would slow global economic growth.
Tracking sharp losses in the US markets overnight and Asian stocks this morning, Indian benchmark indices tanked 1.5% on Friday. The BSE Sensex fell over 1,000 points to 54,668, while the NSE Nifty 50 shed 316 points to 16,366. All frontline stocks were in the red. In the broader markets, the BSE MidCap and SmallCap indices fell up to 2.2%.
The benchmark indexes were on track for a fourth straight weekly drop, pulled down by a surprise interest rate hike by the Reserve Bank of India, foreign fund outflows and mixed corporate earnings results, according to a Reuters report.
Domestic markets are lower on the global headlines, which are focusing more on high inflation as well as the Fed rate increase two days back," Prashanth Tapse, vice president of research at Mehta Equities, was quoted as saying by Reuters.
The Fed on Wednesday raised interest rates by half a percentage point as expected and Chair Jerome Powell explicitly ruled out a 75 basis point hike in the next policy meeting.
But Asian stocks fell over concerns that the US Federal Reserve and some other major central banks will have to raise interest rates even more aggressively to combat red-hot inflation.