In early trade on Tuesday, Indian equity benchmarks dipped, followed generally weaker Asian markets, on concerns about a global recession and a spike in COVID-19 infections in China, which has dampened hopes for lifting stringent pandemic restrictions.
In early trade, the BSE Sensex dropped 326.51 points to 61,479.68, while the broader NSE Nifty also declined.
After three years of COVID-19 restrictions, China is expediting the removal of restrictions, leaving investors wondering how financial markets would react to the reopening.
“The positive reaction to the reopening is starting to give way to the realisation that it’s going to be a lumpy path for China to get there,” JP Morgan Asset Management’s Global Market Strategist Kerry Craig told Reuters.
Apart from China’s reopening, investors forecast that interest rates in the United States would rise faster than expected in 2023.
Former Federal Reserve director William Dudley warned on Monday that rates were expected to climb even as US unemployment began to rise.
