Mumbai: Stock markets across India fell by 5 percent on Thursday in line with a selloff similar to that suffered by US markets following the Fed’s most recent interest rate announcement. With the BSE Sensex declining by more than 1000 points in the day, followed by Nifty decreasing by 291 points, investors lost nearly Rs 5.93 trillion (£56.5 billion).
The Sensex closed at 79,172, reduced by 1001 points, while the Nifty also fell by 291 points to reach 23,907. In intraday trading the indices had gone lower, with Sensex down 1,162 points and Nifty down 328 points.
These came after the US Federal Reserve’s third successive cut to the benchmark interest rate by 0.25 percent. But what was especially unnerving to the investors was the Federal Reserve’s forecast of just two rate cuts for the calendar year 2025, well below market forecasts.
The rupee declined from 56.89 against the USD to 57.15 in the same period, making the total market capitalisation of BSE-listed firms approximately halve from ₹ 452.60 trillion to ₹ 446.66 trillion in a single session. The sectoral indices, except for FMCG, fell as much as 2%, and the FMCG index traded nearly in the red.
A market analyst has attributed the mixed reactions the markets had to the Fed’s conservative approach to future rate cuts. “This, along with global selling pressure, led to selling pressure across the board in Indian stocks.”.
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