BENGALURU: Indian shares fell on Thursday, dragged by auto and metal companies, as investors braced for crucial US inflation data that will provide clues about the severity of the Federal Reserve’s future interest rate hikes.

The NSE Nifty 50 index closed down 0.71% to 18,028, while the S&P BSE Sensex fell 0.69% to 60,613.70.

The US consumer price index (CPI) data for October is due at 1330 GMT, with economists polled by Reuters forecasting a decline in both monthly and yearly core numbers to 0.5% and 6.5%, respectively.

“Markets have been rising, gearing up for a less aggressive rate hike from the Fed. But with a fractured U.S midterm election verdict and the inflation data due, we are seeing some corrections with markets getting ready for some surprises, “said Anand James, Chief Market Strategist at Geojit Financial Services.

The significant sell-off in crypto markets was also weighing on investors’ overall mood, he added. Global share markets edged down on Thursday and the dollar held onto overnight gains before the inflation data’s release.

Indian benchmark indexes hit an over-9-1/2 month peak on Wednesday, driven by the bank Nifty index touching a record high on the back of improved asset quality and credit growth for lenders.

Indian shares ease off 9-month highs ahead of U.S. inflation data

The bank index has gained about 17% so far this year, beating the benchmark Nifty index’s 4% gain.

Meanwhile, the Nifty auto index fell 1.95%, led by a 4.8% drop in Tata Motors as core earnings failed to impress investors despite reporting a narrow quarterly loss on Wednesday.

The metals index fell 0.7%. Shares of Aurobindo Pharma Ltd fell 11.8% after the drugmaker said that India’s federal financial crime agency has arrested a director of the company.