Sensex, Nifty Set To Follow Asian Peers Lower

Indian shares are seen opening lower on Wednesday, tracking weakness in other Asian markets.

The downside, however, may remain limited after RBI governor Shaktikanta Das said he believes that India has the potential to grow at a reasonably high pace in the post-pandemic scenario.

Fitch Ratings forecast robust GDP growth of 8.7 percent during 2021-22 and 10 percent during FY’23, but retained India’s ratings at the lowest investment grade, citing high debt and limited fiscal headroom of the central and state governments.

Benchmark indexes Sensex and the Nifty fell round 0.7 percent and 0.6 percent, respectively on Tuesday amid concerns over overstretched equity valuations, while the rupee gained 9 paise to close at 74.37 against the dollar.

Asian markets were mostly lower this morning as robust economic data out of the U.S. rekindled fears about the pace of interest-rate rises.

Bond yields rose and the dollar hit a four-and-a-half-year high against the yen while oil prices dropped after U.S. gasoline stocks fell more than expected last week.

U.S. stocks advanced overnight as Home Depot and Walmart released results that topped expectations and readings on industrial production and retail sales beat expectations.

The Dow edged up 0.2 percent, the S&P 500 gained 0.4 percent and the tech-heavy Nasdaq Composite climbed 0.8 percent.

European markets extended their record rally on Tuesday as optimism over the Sino-U.S. talks offset concerns surrounding an unusual build-up of Russian troops in and around Ukraine.

The pan European Stoxx 600 gained 0.2 percent. The German DAX rose 0.6 percent and France’s CAC 40 index edged up 0.3 percent while the U.K.’s FTSE 100 dipped 0.3 percent.