US hot inflation data sinks global stock markets
Image credit X.com @NSEIndia
Dow Jones tumbles after US inflation report
By S Jha
New Delhi, September 11: The global equity markets went into a tailspin on Wednesday. The consumer price rise in the US came hotter than expectations.
Dow Jones tumbled in early trades by over 600 points. The US bourses took sharp cuts after the August inflation number was released.
The bulls had betting on a 0.50 percentage rate cuts by the US Federal Reserve. The Central bank of the US is widely expected to announce a first rate cut in several years in September 18 meeting.
Also Read: Bear-bitten investors sight gold shine in darkness of stock market
The bets on 0.50 percentage rate cut nosedived after the consumer price number was released. The street expected the August consumer price rise at 0.2 per cent.
But the core inflation rose in the US last month by 0.3 per cent. This month-on-month climb in the consumer price sank the confidence of the investors for a higher rate cut.
A 0.25 percentage rate cut will be non-event, said market participants. In addition, the cooling manufacturing and unemployment data bring spotlight on economic stress in the US.
Also Read: 3 stocks on traders’ radar amid stock market volatility
Earlier in the day, the Indian bourses sank to lower levels. Nifty gave up the level of 25000 easily. Bank Nifty also fell through the support levels.
The gloom on the US street is likely to come to the Indian equity markets tomorrow. Nifty is precariously set around 24900 level. A crack below may push the 50-share index to much lower levels, said market participants.
The selloff in the small caps and the midcaps have been brutal since August. The bearish sentiments are getting fresh leg ups in the ongoing September series.
The Bajaj Housing Finance IPO closed on Wednesday. The initial offering from the Bajaj stable got a whopping subscription.
Also Read: Bulls return to stock market with sectoral shift
The Bajaj Housing Finance IPO was subscribed 63 times on the last day. Reports claims that the grey market premium was quoting with 96 per cent jump.
The Bajaj Group was also trending on Wednesday. As reported earlier by The Raisina Hills, Bajaj Auto has been trending on the street.
The shares of Bajaj Auto defied the selloff on the street. It was higher by over four per cent. The Bajaj Auto shares closed above ₹11400 on Wednesday.
The Bajaj Finance was also in big demands on the street. It was sharply higher in the day. Overall, it was a good day for the Bajaj Group of companies on the street.
Also Raed: Pharma intermediary sparkles with sharp stock price gains
The consumer durables and the FMCG counters were the only two sectors end the end in the green. The PSU space is being beaten severely on the street.
Among the heavyweights, Tata Motors cracked by over five per cent. But the gains in the small cap pharmaceutical sectors extended on Wednesday.
Disclaimer: This article makes no recommendation for any trade in equity or derivative markets.
Join WhatsApp channel of The Raisina Hills
About The Author
