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Indian stock markets experienced a decline on Wednesday, influenced by a mix of factors. Auto stocks faced a setback as September sales figures raised concerns, while IT stocks were affected by worries about a prolonged period of high interest rates in the United States.
As of 09:55 a.m. IST, the NSE Nifty 50 index was down by 0.69% at 19,393.55, and the S&P BSE Sensex dropped by 0.71% to 65,056.20.
Auto stocks, represented by the NIFTYAUTO index, fell by over 1%, marking their second consecutive session of decline. The weakness in sales of entry-level vehicles and tractors was a contributing factor to this decline.
Maruti Suzuki saw a 2% drop after receiving an income tax penalty notice amounting to 21.60 billion rupees for fiscal year 2020.
Small-cap and mid-cap stocks also suffered losses, declining by 0.5% and 1%, respectively. Satish Ramanathan, the Chief Investment Officer of Equity at JM Financial Mutual Fund, advised investors to be cautious amid global macroeconomic uncertainty. He suggested that investors consider reducing their exposure to small- and mid-cap stocks in favor of larger-cap stocks for the time being.
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Asian equities experienced a decline to an 11-month low due to unexpected data showing a rise in job openings in the United States in August. This raised concerns about the possibility of an extended period of high interest rates.
IT firms, which derive a significant portion of their revenue from the United States, saw a 0.8% decrease in their stock prices due to worries about interest rates.
In terms of individual stocks, Avenue Supermarts gained over 2% after reporting an 18.5% increase in standalone revenue for the September quarter, reaching 123.08 billion rupees.
Nestle witnessed a 4% increase in its stock price after announcing plans to consider an interim dividend and a stock split at an upcoming board meeting later in the month.
On the other hand, Bajaj Finserv experienced a 2% drop following a show cause cum demand notice from the Directorate General Of GST Intelligence in Pune, alleging a tax demand of 10.1 billion rupees against one of its units.
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