Indian shares may see further downside on Tuesday due to persisting concerns about Europe. Moody's has lowered the outlook on three of Europe's strongest AAA countries—Germany, the Netherlands, and Luxembourg—to negative and said that it would also weigh the euro zone developments' impact on Aaa-rated Austria and France.
Asian markets are down modestly following steep losses yesterday, while the euro is hovering near a two-year low against the dollar and a near 12-year low against the Japanese yen.
Indian shares tumbled on Monday, in tandem with a weak trend across Asia and Europe as concerns that the European debt crisis is worsening dented investor sentiment. Domestic political uncertainty, a weaker rupee and reports that reforms like FDI in multi-brand retail may be delayed also weighed on the markets. The benchmark BSE Sensex ended the session down about 280 points or 1.64 percent at 16,877, while the broader Nifty index fell by 87 points or 1.67 percent to 5,118.
U.S. stocks ended notably lower overnight, as signs that Spain could require a full bailout and the rising probability of a Greek exit from the euro zone spooked investors. The Dow slid 0.8 percent, the tech-heavy Nasdaq fell 1.2 percent and the S&P 500 dropped 0.9 percent.
Major European markets also moved sharply lower on Monday, with the German DAX and France's CAC 40 losing about 3 percent each.
U.S. crude futures for September delivery shed $3.69 or 4 percent to close at $88.14 a barrel on the New York Mercantile Exchange, as anxiety about the euro zone debt crisis and concerns that demand in China may drop overshadowed fears of supply disruptions in the Middle East.
by RTT Staff Writer
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