BENGALURU, June 17 (Reuters) - Indian shares slipped in
volatile trade on Friday and were on course for their worst week
in over two years, hit by worries that rapid increases in policy
rates targeted at taming inflation could derail economic
The NSE Nifty 50 index slid 0.51% to 15,282.45, as
of 0446 GMT, while the S&P BSE Sensex fell 0.38% to
51,300.96, with both indexes touching over one-year lows in
their sixth straight session of losses.
The blue-chip indexes are set for losses of over 5% in the
week that saw the U.S. Federal Reserve hike interest rates by 75
basis points and the Swiss National Bank deliver its first rate
hike in 15 years. If losses hold, the Nifty and Sensex could
suffer their worst week since May 2020.
"Investors remain concerned that central banks' commitment
to bringing inflation down will seriously damage a fragile
economic recovery," said Prashanth Tapse, vice president
(Research) at Mehta Equities.
Tapse added that crude prices above the Indian central
bank's assumptions for inflation projections and selling by
foreign investors was creating uncertainty.
Foreign investors have withdrawn a net $3.64 billion out of
Indian equities this month after selling a net $5.18 billion in
"The rising cost of capital will impact valuation multiples
and have an adverse impact on economic growth and corporate
earnings," said Gaurav Dua, head of capital market strategy at
The Nifty IT index and the Nifty Pharma index
, which track some companies that are exposed to the
U.S. market, were among the worst performing sub-indexes on
Friday, falling up to 2.5% each. The Nifty IT index is set for a
weekly drop of around 8%.
Shares of India's largest company, Reliance Industries
, climbed 1.9% after five days off losses, offering the
biggest boost to the benchmark indexes.
Mild gains in metal stocks, on a rebound in
metal prices, helped plug some losses in the market.
(Reporting by Chris Thomas in Bengaluru; additional reporting
by Gaurav Dogra; editing by Uttaresh.V and Shailesh Kuber)