Sensex Opens Lower; IT Stocks Drag

Asian stock markets are lower today as Japanese and Hong Kong shares fall. The Nikkei 225 is off 1.2% while the Hang Seng is down 0.7%. The Shanghai Composite is trading down by 1%. Meanwhile, Wall Street's major indices all slid more than 2% on Monday, with the benchmark S&P 500 closing at its lowest in 14 months, on concerns about slowing economic growth ahead of a highly anticipated decision from the Federal Reserve this week on the course of US interest-rate hikes.

Back home, India share markets opened on a negative note. The BSE Sensex is trading down by 167 points while the NSE Nifty is trading down by 59 points. The BSE Mid Cap index opened the day down by 0.3% while BSE Small Cap index opened down by 0.2%.

Barring energy stocks, telecom and metal stocks, all the sectoral indices have opened the day in the red.

The rupee is currently trading at Rs 71.25 against the US$.

The Indian rupee on Monday recovered by 34 paise to close at 71.56 against the US dollar.

Besides, the American currency's weakness against its major rivals globally helped the rupee further its gains. The recovery came on the back of forex market sentiments driven by the country's narrowing trade deficit in November as also smart gains in domestic equities.

According to commerce ministry data, India's trade deficit came down to US$ 16.7 billion in November 2018 from US$ 17.1 billion in October this year.

Note that, the rupee is the worst performer in Asia in 2018. It has fallen by around 12% against the US dollar this year.

Indian Rupee is the Worst Performing Currency in Asia

This selling pressure was seen on the back of a strong dollar and high oil prices. Similarly, the spill-over from the emerging-market turmoil in Argentina and Turkey weighed on the rupee.

However, in the near term, the rupee being under pressure could benefit export-oriented businesses.

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Disclosure: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. ...

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