India's benchmark stumbled again, with the Nifty 50 down 1.6% and back to levels last seen in April last year. The slump extended Wednesday's 0.8% fall, which followed a rate increase by the central bank and indications of further tightening to tame inflation.
Oil's surge set the tone. Brent climbed more than 4% on fears of an escalation in the Middle East, and the MSCI Asia Pacific Index fell 1.8%, tracking toward its steepest fall since mid-August. Bloomberg data tracking weekly moves through Oct. 8 carried the label that Indian shares were set to fall for a ninth straight week.
Foreign outflows and cost pressure together make a difficult combination. Market Briefs covers emerging markets free every morning.
"Brent near $104 raises imported inflation and margin concerns, while the rupee near 96.8 adds another layer of pressure," said Vikram Kasat, chief business officer at Mumbai-based PL Capital. "Going ahead, volatility may persist." So far this year, foreign investors have withdrawn almost $30 billion from local equities, putting flows on course for a record annual exodus after removing $18.8 billion in 2025. The managing director at Equirus Wealth, Ankur Punj, said, "Intense foreign selling and likelihood for further rate hikes are sending jitters to investors as higher interest rates will hurt long-term growth prospects."
Tata Consultancy Services rose as much as 3% intraday but finished 0.2% lower ahead of quarterly results that broadly matched estimates, supported by cost cuts and a gradually improving flow of contracts. Among Nifty 50 names, Reliance Industries and HDFC Bank were notable laggards. The broader Nifty Smallcap 250 gauge slid 2.4%, its weakest level since mid-June.
Higher oil, pricier money and a softer rupee squeeze profits and cool risk appetite, which is exactly what today's tape reflected. Persistent foreign selling can add pressure across large caps and small caps alike, while the prospect of more rate hikes keeps a lid on valuations. If you own India-focused funds or global ETFs with big India weightings, today's crosswinds explain the bumpier ride.
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