Indian equities on Wednesday declined for the fourth session as investors turned to the US Federal Reserve for clues on the pace of tapering monetary expansion. Paytm plunged after a lock-in period for institutional investors expired.
The NSE Nifty 50 index was down 0.43% at 17,250.4, with information technology firms leading the decline while the S&P BSE Sensex fell 0.43% to 57,864.5.
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The indices have fallen more than 7% from their October highs, but they are still outperforming Asian rivals.
Investors were seeking signals as to when the Fed would stop purchasing assets and begin raising interest rates, while the rapid spread of the omicron coronavirus variant affected sentiment.
“There is palpable fear about a ‘Powell Pivot’ and Fed’s pace of unwinding,” said independent market analyst Ajay Bodke. Commentary about US rate increases would be key as they could potentially lead to fund outflows from countries with a twin deficit like India, he added.
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The Indian rupee fell as much as 0.3% to 76.11 per dollar, its lowest level since June 2020.
A lack of public awareness over omicron’s rapid growth, according to Bodke, increases the likelihood of the healthcare system becoming overburdened again.
The Nifty IT index fell up to 1.5%, with Tata Consultancy Services dropping as much as 1.8% to a one-week low.
Bajaj Finance and Bajaj Finserv, both heavyweight shadow lenders, fell 2% and 1.2 %, respectively.
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Following a disappointing market debut on November 18, One97 Communications, the parent company of digital payments provider Paytm, fell 13% to its lowest since November 22.
SpiceJet surged 3.4% after the low-cost carrier announced a settlement deal with a Canadian aircraft manufacturer.