Indian share markets closed slightly lower on Tuesday on global cues as dollar continued to slide on comments from US Federal Reserve officials that the central bank won’t accelerate the pace of its interest rate hikes in 2017.
The 30-share benchmark Sensex opened at 29525.88 and fell to as low as 29380.14 in intraday trade but recouped some losses to close down 33 points or 0.1% at 29,485.45. The Nifty was down 0.06% at 9,121.50.
Banking, auto, metals, pharma and telecom stocks dragged down the markets. The BSE Metals and Auto indices fell as much as 0.5% with SAIL, Vedanta, JSW Steel and Hindustan Zinc and National Aluminium were down 0.7-1.4% each.
Pharma majors skid with Dr Reddy’s fell 4.4% on news the US FDA has warned the drug maker for failure to maintain complete data to ensure compliance. Sun Pharma was down 1.1%, while Cipla closed down 0.9% and Lupin 0.8%.
Among the telecom pack, Idea plunged 5% while Bharti was flat and Reliance Industries, which owns Jio, shed 1.3%.
India’s telecom shares have been falling since Monday after Idea Cellular was valued at Rs 72.50 a piece, or less than three-fourth the market price, after the world’s leading mobile service provider Vodafone announced a merger deal with the KM Birla company.
On Monday, Indian share markets closed down tracking Asian and European bourses as investors factored in rising protectionism after the G20 failed to agree on free trade even though they reiterated their resolve to avoid competitive currency devaluation.
On Tuesday, Asian shares traded in the green with the MSCI’s broadest index of Asia-Pacific shares outside Japan rising 0.1% to stay near a 15-month high.
Nikkei fell as much as 0.8% but closed down 0.34%. Kospi was up 1% to hit two-year highs while Hang Seng was up 0.4% and Strait Times down 0.2%.
On Monday, Wall Street ended down as doubts increased over US President Donald Trump’s ability to quickly roll out an expansionary fiscal policy through tax cuts and higher government spending to spur economic growth.
The dollar retreated after Chicago Federal Reserve President Charles Evans indicated gradual rate hikes. On March 15, Fed hiked rates by 25 bps and its chair Janet Yellen said there will be two more, lower than what investors feared earlier.
The dollar index, which tracks the greenback against a basket of six major rivals, was down 0.1% to 100.35 after falling as low as 100.02.
Oil prices were muted on concerns of growing US oil output and high inventories. Brent crude futures were at $51.62 a barrel while US crude futures WTI traded below $50 per barrel.