($1 = 81.9910 Indian rupees) (Reporting by Bharath Rajeswaran in Bengaluru; editing by Eileen Soreng and Sonia Cheema)
+919769003463)) (Updates levels, adds analysts' comments)
By Bharath Rajeswaran
BENGALURU, March 9 (Reuters) - Indian shares declined on
Thursday as concerns of a prolonged high-interest rate regime
weighed on sentiment.
The Nifty 50 index was down 0.40% at 17,682.75 as of
10:44 a.m. IST, while the S&P BSE Sensex lost 0.37% to
60,123.82.
The drop comes after domestic equities gained in the
previous three sessions, defying the weakness in global markets
on worries that the Federal Reserve will continue to raise rates
higher and for longer. Eleven of the 13 sectoral indexes declined, with the
heavyweight financials and information technology
(IT) indexes losing 0.3% and 0.5%, respectively.
IT stocks, in particular, are sensitive to rate hikes in the
United States and Europe where a majority of their clients are
based.
Analysts expect the Nifty 50 to trade in a narrow range
until the Fed's policy decision on March 22, at which it is
expected to raise rates by 50 basis points. "A 50 bps rate hike in the next Fed meeting is a given. With
further rate hikes, debt will become more attractive," said G
Chokkalingam, founder and chief investment officer at Equinomics
Research.
"Investors will wait for the monsoon forecast, rate hike
trajectory, revival in domestic corporate earnings and growth
figures before they turn definitively turn positive on the
Indian markets."
Meanwhile, metals stocks were among the bright
spots, advancing 0.75% on hopes that the reopening of the
Chinese economy would boost demand.
Brokerage firm Jefferies also notes attractive valuations
given the index has fallen over 15% so far in 2023, compared to
a 2% slide in the benchmark Nifty 50.
Hindalco , Tata Steel and JSW Steel were among the top gainers in the Nifty 50.
SBI Life Insurance Co Ltd lost over 1%, the most
on the Nifty, after reporting tepid growth in February premium
collections.
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