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BENGALURU, May 2 (Reuters) – Indian shares kicked off May on a tepid note, with losses seen across the board following a sharp sell-off in Wall Street on Friday, as investors cautiously awaited an expected rate hike by the Federal Reserve this week.
The NSE Nifty 50 index (.NSEI) was down 0.65% at 16,991.05, as of 0455 GMT on Monday, with its major sub-indexes in the negative, while the S&P BSE Sensex (.BSESN) fell 0.65% to 56,687.60. The benchmark indexes had posted losses on Friday for a third straight week.
Nifty’s IT (.NIFTYIT), auto (.NIFTYAUTO) and metal (.NIFTYMET) sub-indexes were among the top segment losers, falling between 0.7% and nearly 2%.
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“The sharp sell-off in U.S. markets on Friday is an indication of the nervousness and fear in the market caused by an increasingly hawkish Fed, rising dollar index and the prolonged war in Ukraine,” said V K Vijayakumar, chief investment strategist at Geojit Financial Services, adding that the market volatility is likely to continue for some time.
Several Asian markets are closed for a public holiday, while Indian markets will be closed on Tuesday.
Investor focus is also on the Federal Reserve, which is expected to aggressively raise rates by 50 basis points when the U.S. central bank’s meeting concludes on Wednesday.
Market participants will watch for signals about future path for interest rates, the Fed’s plans for reducing its balance sheet and its view on when inflationary pressures will recede.
Nifty 50 components Britannia Industries (BRIT.NS) lost 1.4%, while HDFC Ltd (HDFC.NS) climbed 1% ahead of their quarterly earnings updates due later in the day.
IT services provider Wipro (WIPR.NS) was down 2.7% and among the top losers in the Nifty 50. The company had flagged last week that pressure on margins would continue over the next two to three quarters. read more
Mahindra & Mahindra (MAHM.NS), which was the sole gainer in the Nifty auto sub-index, edged up 0.16% after the carmaker said domestic passenger vehicle sales for April rose 23% year-on-year.
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Reporting by Rama Venkat in Bengaluru; Editing by Vinay Dwivedi and Sherry Jacob-Phillips
Our Standards: The Thomson Reuters Trust Principles.
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