Among the Sensex stocks, ICICI Bank, Kotak Bank, Axis Bank, Bajaj Finance and SBI were down between 1% and 2.5%.
consumer prices surged at the fastest pace since 1990 last month, boosting the case for faster Federal Reserve policy tightening.
This has the potential to spill over to global commodity inflation,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Pushed by the inflation report, investors are now pricing in a 66.5% chance that the Fed will raise rates by the end of June, according to a Associated Press report.
But there are many who believe that the Fed is behind the curve and that the entrenched inflation will force the Fed to accelerate tapering and advance rate hikes.
The Indian rupee depreciated by 20 paise to 74.54 at day’s low against the US dollar, weighed down by a lacklustre trend in the domestic equity market and firm American dollar.