Rate, inflation worries set Indian shares for worst week since May 2020
India Today
Indian shares slipped in volatile trade on Friday and were on course for their worst week in over two years.
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 recovery.
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.
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"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Foreign investors have withdrawn a net $3.64 billion out of Indian equities this month after selling a net $5.18 billion in May.
Sensex has declined over 6,000 points or roughly 7.5% in a little over two weeks as global tensions and rising oil prices triggered selling in equities.
Speaking in Parliament, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said India has adequate fuel stocks, and there is no cause for concern over availability.
Industry sources told India Today TV that airline operators are now paying additional insurance charges for every aircraft flying into the Middle East, significantly increasing the cost of operations on these routes.
Under law, a domestic household is generally allowed to keep two LPG cylinders of 14.2 kg each at a time. This usually includes one cylinder connected for use and another spare cylinder kept as backup.
Early signals from GIFT Nifty suggest that the benchmark indices could open lower when trading begins. GIFT Nifty futures were trading at 23,784.50 at around 7:58 am. This indicates that the Nifty 50 may open below Wednesday's closing level of 23,866.85.
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The move comes as global energy markets remain on edge due to escalating tensions linked to the conflict involving Iran, which has raised fears of disruptions to crude oil shipments from the Middle East.
India consumes roughly 5.3 to 5.5 million barrels of crude oil every day. However, domestic production is only about 0.6 million barrels per day. This means the country depends on imports for nearly 85% of its oil needs.
At around 10:47 am, the BSE Sensex was down 750.68 points or 0.96% at 77,455.30, while the Nifty 50 slipped 208.25 points or 0.86% to 24,053.35.
Air India said the fuel surcharge is due to the sharp rise in aviation turbine fuel (ATF) prices since early March 2026, triggered by supply disruptions in the Gulf region.
Rahul Bhatia expressed gratitude to employees who worked tirelessly to restore operations during that challenging period, praising their resilience and dedication.
The Iran-US conflict has disrupted shipping through a key global oil export route, pushing oil prices higher. As a result, airline tickets on some routes have become much more expensive, and there are growing concerns that travel demand could weaken if the situation continues.