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Sensex sinks below 51K, Nifty tests 15,200 on US recession fears, central bank tightening – Economic Times

NEW DELHI: Benchmark stock indices fell on Friday morning after another steep fall for Wall Street stocks overnight, thanks to fears of recession in the world’s largest economy. Concerns over tightening monetary policy globally also weighed on the sentiment.

The Bank of England on Thursday lifted rates for a fifth straight time to their highest since 2009. The Swiss central bank also increased its policy rate by half a per cent, the first time in 15 years. Meanwhile, the European Central Bank has also hinted at a rate hike soon.

At 9.30 am, the BSE Sensex was trading 497.90 points or 0.97 per cent lower at 50,997.89. Nifty50 was trading at 15,197.50, down 163.10 points or 1.06 per cent. Midcap and smallcap indices fell up to 1.8 per cent.

“Even the most ardent FOMO gnome had a conviction crisis as a swath of central banks followed the Fed’s lead and hiked policy rates. Taiwan hiked 12.50 bps, the Bank of England hiked 25 bps and the Swiss National Bank shocked markets, hiking policy rates by 50 bps. It was probably the SNB that broke the camel’s back because if the Swiss are worried about inflation, we all should be,” said Jeffrey Halley, Senior Market Analyst, Asia Pacific, OANDA.

Among Sensex stocks,

fell 2.19 per cent to Rs 413.15. declined 2.21 per cent to Rs 2016.60. , , and fell up to 1.8 per cent. , and were only Sensex gainers, rising up to 0.9 per cent.

Overall, four stocks on BSE fell for every stock that rose. A total of 311 stocks had hit their 52-week lows within the first 15 minutes of trade.

Nomura India said the updated Fed policy statement along with the updated economic outlook cemented the Fed’s shift to a “single-mandate” central bank, underscoring the prioritisation of returning inflation to 2 per cent above all else.

“With slower growth and higher unemployment rate forecasts, the Fed’s latest economic projections underscore what we believe was a critical pivot point in their outlook as policymakers seek to actively constrain demand,” it said.

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