India shares close at two-week low

BENGALURU, Sept 21 (Reuters): India's benchmark indexes on Thursday closed at a two-week low in a broad-based selloff, after the US Federal Reserve signalled that interest rates will remain elevated for longer.

The Nifty 50 closed 0.8 per cent lower at 19,742.35 points, its lowest close since Sept.7, while the S&P BSE Sensex declined about 0.85 per cent to 66,230.24 points.

Both the indexes fell for a third straight session on Thursday, losing as much as 1 per cent. They are also down more than 2 per cent so far this week, after gaining 2 per cent each and hitting all-time highs in the previous week.

"The Fed's reiteration that the rates could remain higher for longer is a concern. That has kind of created negative sentiments for equity markets across the world, including India," said Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services.

The Fed on Wednesday held key interest rates unchanged as widely expected, but warned that the battle against inflation was far from over.

Higher interest rates dry up liquidity from the markets, increasing the cost of capital.