BENGALURU, Sept 29 (Reuters) – Indian stocks ended lower for the seventh consecutive session on Thursday, led by technology stocks, ahead of the central bank’s policy outcome on Friday amid lingering fears of a global recession .
The NSE Nifty 50 Index (.NSEI) fell 0.24% to 16,818.10, while the S&P BSE Sensex Index (.BSESN) fell 0.33% to 56,409.96. Both indexes had their worst losing streak since mid-February.
Investors began another round of selling on Thursday as the dollar tightened its grip on currency markets, while recession fears undermined stocks.
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“Traders preferred to reduce their position in some of the rate-sensitive stocks ahead of the credit policy announcement,” said Shrikant Chouhan, head of equity research (Retail), Kotak Securities.
“The market is already in an oversold position and if the rate hike is higher than estimated, we could see bouts of intraday volatility with a negative bias for some time to come.”
Foreign institutional investors sold nearly 106.97 billion Indian rupees ($1.31 billion) worth of shares up to Wednesday, according to National Stock Exchange data.
“A near-record Indian equity valuation premium for
comparable markets as well as domestic bonds indicates a kind of decoupling for Indian bonds as well as for equity markets,” CLSA said in a note.
“We don’t expect this to be sustainable and see it as a sign of a very low margin of safety. A simple reversion in the valuation mean anchored on bond yields indicates fears of a 30% decline in the Nifty “said the brokerage.
The Nifty and Sensex are down nearly 3% year-to-date.
The Nifty IT index fell 0.9%, while the energy index (.NIFTYENR) fell 0.8%.
Oil & Natural Gas Corp (ONGC.NS) was the biggest gainer in the Nifty 50, up 3.4%, while Asian Paints (ASPN.NS) was the biggest loser, down 5.2% .
($1 = 81.7780 Indian rupees)
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Reporting by Nallur Sethuraman in Bangalore; Editing by Savio D’Souza and Dhanya Ann Thoppil
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