Rate hike fears over high inflation buffet markets

Sensex slips below 60,000 and Nifty lingers at lows of more than four-months

- Ujjval Jauhari

Indian stocks saw a sharp decline on Wednesday, mirroring a similar trend in the US markets, with the benchmark indices Sensex and Nifty each falling more than 1.5% as investor sentiment soured because of the continued uncertainty over future rate hike decisions by the US Federal Reserve.

The BSE's Sensex slipped below the 60,000 mark, and the National Stock Exchange's Nifty ended at its lowest level since 20 October at 17,554, as investors grappled with recent economic data from the US and Europe. Slow disinflation rates indicated by recent economic data suggest that the Fed may continue to raise rates longer than previously anticipated, experts said.

Shrikant Chouhan, head of equity research (retail) at Kotak Securities Ltd, said that the overnight slump in the US markets shook Indian markets badly as heavy selling across the board saw Sensex crash nearly 1,000 points.