Indian indices tumbled Friday on cues from the Dow Jones, which fell overnight after data showed consumer prices rose the most in 40 years, causing the dollar to rise against the rupee.
The Nifty and the Sensex fell 1.3% each as domestic institutional investors sold shares worth a provisional `697 crore and foreign investors sold futures contracts on the Nifty and Bank Nifty worth a net Rs 1,053 crore even as their cash purchases were a tepid Rs 108 crore.
A total of Rs 3.9 lakh crore of investors’ wealth was wiped out led by falls in IT majors and cement counters such as Infosys, Wipro, Tech Mahindra, HCL Technologies and UltraTech Cement, which fell between 2% and 3%.
Inflationary fears in the US and Europe are likely to cast a shadow on emerging market equities in the coming sessions. “The US inflation at 7.5%, a multi-year high, and the probability of the Fed getting soon into a tightening mode, dampened the sentiment in overseas markets, especially in the US and Europe , and these movements are getting reflected in the domestic market as well,” said Joseph Thomas, research head, Emkay Wealth Management. Immediate support for the Nifty is at 17100 and resistance at 17400-17500.