Express press service
MUMBAI: Indian stocks opened with deep cuts, in line with their Asian peers. The Nifty and Sensex opened a gap down 2% each at 15877.55 and 54303.44.
Rising inflation and war in Europe have fueled stagflation and recession fears globally, with Indian businesses likely to be hurt by input price pressures. Relatively high valuations for financials, metals and IT companies add risk, especially as central banks raise rates and change policy stance.
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The India Vix Fear Gauge rose 8.6% to 21.26 while Nifty and Sensex trade below their opening prices. Losses were led by Hindalco, Bajaj Twins and ICICI Bank, with all 50 shares trading in the red.
FIIs have sold a whopping Rs 1.8 lakh crore of Indian shares since the start of the year. The March low of 15671 is in danger of being breached according to Hormuz Maloo, director of AFco Investments.
The rupee traded down 37 paise at 78.21.
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Churchil Bhatt, EVP, Debt Investments, Kotak Mahindra Life Insurance Company, said: “It is natural for emerging market currencies to weaken during risk sentiment. High oil import bills and REIT stock exits are the main market drivers at this point. India has sufficient reserves to handle any excess volatility, the INR can be expected to align with its Asian peers. We expect the INR to exhibit a short-term bias for an orderly decline towards 80 levels.