Sensex Falls 300 Points, Nifty Below 8,850 on Global Cues

Asian stocks buckled while the dollar held firm on Monday after strong U.S. jobs data fanned expectations that the U.S. Federal Reserve may raise interest rates sooner than previously thought.

 

Stock markets across Asia, including Japan's Nikkei, Australia, Malaysia and Indonesiafell broadly, with MSCI's broadest index of Asia-Pacific shares outside Japan dropping 1.2 per cent.

 

U.S. non-farm payrolls (NFP) data on Friday showed the unemployment rate hit a 6-1/2-year low of 5.5 per cent in February.

 

Wage gains were only slight, yet the data stoked expectations that the Fed was now likely to drop a reference to patience on the timing of a rate hike at its next policy meeting on March 18, thus opening the door for a June rate rise.

 

Back home, selling pressure was visible across the sectors. Baniking, IT, capital goods and power stocks wer the worst hit in the morning deals. The banking sub-index- Bank Nifty fell nearly 2 per cent. IT, capital goods and power indices were also quoting weaker by around 1 per cent each.

 

Shares of IT giant TCS fell over 2 per cent to Rs 2,638 after its management sounded cautious about March quarter earnings. TCS said it continues to see weakness in insurance vertical, while identifying energy and telecom verticals as "problem areas".

 

Hindalco, Axis Bank, Ultratech Cement, ICICI Bank, Kotak Mahindra Bank, 

Punjab National Bank, HDFC, IndusInd Bank and NTPC were also trading weaker by 1.6-2 per cent each.

 

At 10:50 AM, the Sensex was down 361 points at 29,088 and the Nifty 117 points lower t 8,821.

 

(With inputs from Reuters)