Indian stocks fall as oil prices rise; Banks and consumer companies weigh

Indian stocks fell on Tuesday, dragged down by heavy banking and consumer stocks, with continued rally in crude oil futures weighing on sentiment further.

By 0410 GMT, the premium NSE Nifty 50 was down 0.34% to 17,061.15, while the S&P BSE Sensex was down 0.38% to 57,076.89.

Both indices rose about 4% last week, buoyed by plunging oil prices, signs of progress in peace talks between Russia and Ukraine, and further easing of domestic restrictions on COVID-19 amid an expanded vaccination campaign.

But the lack of material progress in peace talks amid the ongoing fighting, and a possible European Union energy embargo on Russia, has sent oil prices up again. [O/R]

“For India, the jump in crude oil to $118 from recent $100 levels is again a major concern. This kind of short-term volatility in crude oil is very concerning,” said VK Vijayakumar, senior investment analyst at Geojit Financial Services.

Two traders told Reuters late on Monday that state-controlled fuel retailers in India, the world’s third largest oil consumer and importer, will raise petrol and diesel prices for fuel pumps for the first time since November.

Shares of Bharat Petroleum Corp., Hindustan Petroleum and Indian Oil Corp. rose 1.6 percent -3 percent.

India’s central bank governor said on Monday that inflation is expected to ease in the future despite “unimaginably uncertain” global crude oil prices, adding that there is no risk of stagflation in the country.

The Nifty FMCG Index is down 1.68%. Consumer giant Hindustan Unilever lost 3.4% and was the biggest loser in the Nifty 50.

Nifty Bank fell 1.2% and was on track for a second consecutive session of losses.

Shares of Future Group companies fell between 10.5% and 13.9%. Indian lenders are set to start debt recovery actions against Future Retail this week.

(Reporting by Anunrun Kumar Mitra in Bengaluru; Editing by Subhranshu Sahu and Uttaresh.

(The title and image for this report may have been reformulated only by the Business Standard staff; the rest of the content is automatically generated from a shared feed.)

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