Indian shares set for muted start as Fed rate worries, China concerns weigh

BENGALURU (Reuters) – Indian shares are set to start Friday flat amid an overnight slide in U.S. equities on rate concerns and choppiness in Asian equities on deflation and demand worries in China.

India’s GIFT Nifty on the NSE International Exchange was up 0.13% at 19,309 at 8:01 a.m. IST.

India’s Nifty 50 and Sensex fell on Thursday, dragged by information technology (IT) stocks. The bluechips are down over 0.25% each this week so far.

U.S. equities fell on fears of prolonged high interest rate after the minutes of Federal Reserve’s latest policy meeting, released earlier this week, indicated divided view among central bank members on further rate hikes. Additionally data signaling tightness in labour markets added to rate concerns as well.

Asian markets were subdued, on worries over China’s property sector after the embattled real estate firm Evergrande filed for bankruptcy protection in a U.S. bankruptcy court. [MKTS/GLOB]

While the benchmarks Nifty and Sensex has witnessed consolidation since hitting record high on July 20, the more domestic focused smallcaps and midcaps remained resilient, on course to post gains for the eighth week in a row.

Analysts said that profit-taking in domestic equities has intensified due to weak global cues, with rising U.S. bond yields and depreciation in currency levels also weighing on sentiment.

Foreign institutional investors sold Indian shares on a net basis on Thursday, offloading 15.11 billion rupees ($181.97 million), while domestic institutional investors sold shares worth 3.14 billion rupees, according to provisional National Stock Exchange data.


** Punjab National Bank, Shriram Finance, Trent, TVS Motor, Zydus Lifesciences: Firms to be included in Nifty Next 50, with effect from September 29.

** ACC, FSN E-Commerce, HDFC Asset Management, Page Industries: Firms to be excluded from Nifty Next 50 from September 29 on account of semi-annual index review.

** Adani Enterprises: Subsidiary Mundra Solar Energy gets commercial operational date certificate from Solar Energy Corporation of India for solar photovoltaic (PV) cells and modules manufacturing plant in Gujarat.

** LTIMindtree: U.S. insurance provider Aflac selects company as digital transformation partner.

($1 = 83.0360 Indian rupees)

(Reporting by Bharath Rajeswaran and Manvi Pant in Bengaluru; Editing by Nivedita Bhattacharjee)