Taking a cue from Asian markets, the key Indian equity market indices on Thursday opened lower with fears over the Reserve Bank of India (RBI) turning more hawkish in its monetary policy stance.
Benchmark indices continued to reel under selling pressure with Sensex down as much as 850 points around 12.00 pm while the 50-share Nifty tumbled nearly 250 points to test the 10,600-mark.
Rise in crude oil prices, along with a weak rupee and outflow of foreign funds, had dragged the key domestic equity indices lower over one per cent on Wednesday.
In addition, fears over the central bank turning aggressive in its monetary policy stance due to a rise in inflationary pressure also led to erosion in investors’ risk-taking appetite.
On Thursday, Asian indices were showing a negative trend. Japan’s Nikkei 225 was quoting in red, down by 0.72 per cent while Hang Seng was down by 1.80 per cent, South Korea’s Kospi was also down by 1.41 per cent.
Overnight, Nasdaq closed in green, up by 0.32 per cent while FTSE 100 was also up by 0.48 per cent at the closing on Wednesday.
The Indian Rupee on Thursday hit a new low of 73.77 by plunging 43 paise against the American currency to close at a record 73.34, amid soaring crude oil prices and unabated capital outflows.
The dollar index stood tall, boosted by a spike in Treasury yields following upbeat US data
The rupee on Wednesday breached the 73-mark against the US dollar for the first time ever on strong demand for the American currency from importers.
(With agency inputs)