oppn parties US Fed Commentary Spooks Stock Markets

News Snippets

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  • Bank account to soon have 4 nominees each
  • TMC and SP stayed away from the INDIA bloc protest over the Adani issue in the Lok Sabha
  • Delhi HC stops the police from arresting Nadeem Khan over a viral video which the police claimed promoted 'enmity'. Court says 'India's harmony not so fragile'
  • Trafiksol asked to refund IPO money by Sebi on account of alleged fraud
  • Re goes down to 84.76 against the USD but ends flat after RBI intervenes
  • Sin goods like tobacco, cigarettes and soft drinks likely to face 35% GST in the post-compensation cess era
  • Bank credit growth slows to 11% (20.6% last year) with retail oans also showing a slowdown
  • Stock markets continue their winning streak on Tuesday: Sensex jumps 597 points to 80845 and Nifty gains 181 points to 24457
  • Asian junior hockey: Defending champions India enter the finals by beating Malaysia 3-1, to play Pakistan for the title
  • Chess World title match: Ding Liren salvages a sraw in the 7th game which he almost lost
  • Experts speculate whether Ding Liren wants the world title match against D Gukesh to go into tie-break after he let off Gukesh easily in the 5th game
  • Tata Memorial Hospital and AIIMS have severely criticized former cricketer and Congress leader Navjot Singh Sidhu for claiming that his wife fought back cancer with home remedies like haldi, garlic and neem. The hospitals warned the public for not going for such unproven remedies and not delaying treatment as it could prove fatal
  • 3 persons died and scores of policemen wer injured when a survey of a mosque in Sambhal near Bareilly in UP turned violent
  • Bangladesh to review power pacts with Indian companies, including those of the Adani group
Devendra Fadnavis to be the next chief minister of Maharashtra after Eknath Shinde agrees to join the government as deputy CM
oppn parties
US Fed Commentary Spooks Stock Markets

By Ashwini Agarwal
First publised on 2022-01-27 08:13:09

Stock markets crashed once again on Thursday in early trades due to the US Fed decision to raise interest rates from March and the hawkish stance adopted by the chairman Jerome Powell. The markets fear that if US interest rates are hiked, there will be huge outflows of foreign funds. Hence, the markets came under selling pressure.

The Sensex crashed 1400 points as foreign funds sold equities but recovered as Indian buyers propped it up by buying at lower levels. The Sensex recovered more than 400 points by 1 pm. But the overall sentiment is negative.

The other factors that are spooking the markets include mixed Q3 results, pre-budget jitters, rising crude prices and geopolitical tensions. Investors are not convinced about economic recovery and the poor results of auto major Maruti and other companies have further eroded confidence. Operators are also worried about what the budget holds in store, with income and wealth disparities grabbing headlines in recent days. Further, crude prices crossed the $90 mark today, raising fears of rise in pump fuel prices and further inflation in India. Lastly, the stand-off between Ukraine and Russia sees no signs of a cool-off and the Russian build up on the Ukraine border signals a possible invasion. The US and Nato forces are preparing for that eventuality.

All this is taking a huge toll on equity prices and creating a panic amongst investors. For an emerging market like India, such volatility in stock markets is not good for both the investors and companies hoping to raise capital through IPOs. It erodes investor confidence and makes for negative sentiments. The market is not expected to stabilize before the budget and investors are advised caution.