Mumbai: In the midst of the worldwide selloff brought on by growing worries over the stability of Swiss lender Credit Suisse Group AG, India’s leading NSE Nifty 50 Index was set for a technical correction.
The gauge slid as much as 0.5% Thursday, taking losses from an all-time high in early December to almost 10%. Up to 0.4% of the S&P BSE Sensex Index decreased. The local market has also been affected by rising interest rates and this year’s stock market crash in the Adani conglomerate.
Since reaching record highs on December 1, both the Nifty and Sensex indexes have been declining as the central bank’s ongoing interest rate increases have dimmed expectations for the South Asian country’s economy to improve. Concerns about a worldwide economic downturn have increased as volatility in the financial sector in the US and Europe has put pressure on the shares of financial companies, shadow lenders, and banks, which account for around 40% of the benchmark Sensex.
Experts are beginning to predict a decline in the demand for loans in India, which has been essential to the lenders’ recent outperformance.
The enormous drops in Adani group after Hindenburg Research claimed the ports-to-power conglomerate of accounting fraud and stock manipulation were exacerbated by the return of foreigners selling local shares.
The Adani group experienced a decline that peaked at $153 billion in late January, erasing over two-thirds of its total stock value before recovering part of the losses. India, however, lost its ranking as one of the top five markets globally as a result of the slump.