Indian equities slumped as elevated oil prices, higher bond yields and rising borrowings costs fuel persistent selling by investors.
The NSE Nifty 50 Index fell 1.6% to its lowest level since April last year, adding to its 0.8% dip Wednesday after the central bank raised interest rates and signaled more tightening to curb inflation.
The selloff in local shares mirrored declines in most regional and global peers as brent crude jumped more than 4% amid worries over escalations in the Middle East. The MSCI Asia Pacific Index tumbled 1.8%, on course for its biggest slide since mid-August.
“Brent near $104 raises imported inflation and margin concerns, while the rupee near 96.8 adds another layer of pressure,” said Vikram Kasat, chief business officer with Mumbai-based PL Capital. “Going ahead, volatility may persist.”
Foreign investors have taken out almost $30 billion from local shares so far this year, heading for their record annual selling, following withdrawal of $18.8 billion in 2025.
“Intense foreign selling and likelihood for further rate hikes are sending jitters to investors as higher interest rates will hurt long-term growth prospects,” according to Ankur Punj, managing director at Equirus Wealth.
Tata Consultancy Services Ltd. gave away a gain of as much as 3% to close 0.2% lower before its quarterly earnings that broadly matched · estimates, helped by cost-cutting measures and a gradually improving contract flow.
Reliance Industries Ltd. and HDFC Bank Ltd. were key decliners among Nifty 50’s members. Nifty’s broader gauge of 250 small-cap stocks fell 2.4% to its lowest since mid-June.