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Indian equities nosedive on US Fed’s commentary: 4 factors spooking the market

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3 years ago

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Indian equities nosedive on US Fed’s commentary: 4 factors spooking the market

Domestic stocks came under intense selling pressure on Jan. 27, as comments from Federal Reserve Chairman Jerome Powell spooked investors after the central bank’s monetary policy statement on Jan. 26.

In early morning session on January 27, the Nifty 50 index plummeted 280 points, or 1.6 percent, to 16,997, while the BSE-Sensex was at 57,031, down 1.4 percent or 826 points.

Investors were troubled by Powell’s hawkish comments on the scope of future monetary policy tightening, even as the central bank left its benchmark interest rate unchanged and signaled that a near-term rate hike would be “appropriate.”

Powell said at a news conference after the policy announcement that the upside risks of a strong U.S. labor market and decades of high inflation mean the central bank has plenty of room to raise interest rates in the background while it shrinks its balance sheet.

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“I think there’s quite a bit of room to raise interest rates without threatening the labor market,” Powell said. Market participants interpreted the Fed’s comfort on the economy as a signal that the Fed may raise interest rates. The rate hike has more than quadrupled this year.

Investors widely expect the central bank to raise interest rates four times in 2022 ahead of its Jan. 26 monetary policy meeting. Investment bank Nomura reportedly expects the central bank to raise interest rates by 50 basis points at its upcoming March meeting.

Still, for emerging markets such as India, a faster pace of rate hikes could further accelerate foreign capital outflows from the country. So far, foreign investors have withdrawn nearly Rs. Domestic stocks hit Rs 100 crore since early October.

Pressure from foreign inflows was also weighed down by the rise in the dollar index. The U.S. dollar index rose nearly 1% on Jan. 26 after Jerome Powell’s hawkish statement. A recent report from JPMorgan India showed that the Nifty 50 index was negatively correlated with the US dollar index as carry trades were affected.

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Virat Kohli pays tribute to Ratan Tata, Jay Shah ‘deeply saddened’ by veteran industrialist’s demise

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3 weeks ago

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October 10, 2024

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Virat Kohli pays tribute to Ratan Tata, Jay Shah ‘deeply saddened’ by veteran industrialist’s demise

Tributes continue to pour in for Ratan Tata, with Virat Kohli and Jay Shah taking to their social media accounts to bid farewell to the industrialist.

Former Indian captain and batting legend Virat Kohli paid a touching tribute to Ratan Tata, the legendary business tycoon, who passed away on Wednesday night. Tata, a Padma Vibhushan recipient, was undergoing treatment in intensive care since Monday but breathed his last in Mumbai, leaving a profound impact on many across the nation.

Kohli expressed his condolences through his Instagram account on Thursday morning, sharing a heartfelt message along with a photo of the late industrialist.

Tata’s contribution to business, society, and philanthropy has been widely acknowledged, and his passing marks the end of an era.

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The Board of Control for Cricket in India (BCCI) secretary, Jay Shah, also conveyed his sorrow, stating, “Deeply saddened by the loss of Shri Ratan Tata Ji. His leadership, integrity, and dedication to society set a remarkable standard for legacy. My heartfelt condolences to his loved ones. Rest in peace, Sir.” Shah’s words reflect the collective grief of a nation that has long admired Tata’s contributions to the country.

BCCI’s tribute

Additionally, the BCCI issued a statement about his demise.

“The BCCI expresses its deepest sorrow and joins the nation in mourning the passing of Shri Ratan Tata ji. His invaluable contributions across diverse fields have been instrumental in shaping India’s growth and success story.

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His extraordinary legacy, founded on the principles of passion, empathy, visionary leadership, innovation, and excellence, will continue to inspire and guide future generations for years to come,” the statement read.

Ratan Tata, born on December 28, 1937, in Mumbai, embarked on his journey with the Tata Group in 1962 as a young executive. Over the decades, he transformed the group into a global conglomerate. His work was acknowledged with India’s second-highest civilian honour, the Padma Vibhushan, in 2008, and he received numerous accolades, including honorary doctorates from prestigious institutions in India and abroad.

Tata is survived by his family, including brothers and sisters Simone Tata, Jimmy Tata, Noel Tata, Aloo Tata, Shireen Jejeebhoy, Deanne Jejeebhoy, Leah Tata, Maya Tata, Neville Tata, Manasi Tata, Jamset Tata, Tiana Tata, and others, as mentioned in a family statement.

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