Indian shares set to open lower as Powell fans rate worries

BENGALURU, Oct 20 (Reuters) - Indias blue-chips are set for a lower open on Friday after U.S. Federal Reserve Chair Jerome Powells comments fanned worries over higher-for-longer interest rates, adding to mounting concerns over the Middle East crisis.

Indias GIFT Nifty was down 0.16% at 19,524.50 as of 8:17 a.m. IST. The Nifty 50 (.NSEI) closed 0.24% lower on Thursday at 19,624.70.

Asian markets (.MIAPJ000PUS) declined a steeper 0.71%.

That was after Wall Street dropped overnight, while U.S. 10-year Treasury yields hit fresh 16-year highs after Powell said the U.S. economys strength and tight labour market meant that further policy tightening could be needed.

However, Powell added that the rise in U.S. yields helped in tightening, echoing the views of Fed officials last week.

Brent crude futures rose above $93 per barrel on fears the Israel-Hamas conflict could spread. Rising oil prices hurt net importers like India.

The benchmark Nifty 50 (.NSEI) is down 0.64% so far this week, on track to snap a two-week winning streak, as rising oil prices and U.S. yields, the Middle East conflict and interest rate worries continue to nag investors.

Adding to the pressure, foreign institutional investors (FIIs) have continued to pile out. They net sold shares worth 10.93 billion rupees ($131.4 million) on Thursday, while domestic investors bought shares worth 7.36 billion rupees.

Meanwhile, earnings have been mixed, with IT companies facing the brunt of weakening global demand, but key consumer companies like Hindustan Unilever (HLL.NS) and Nestle India (NEST.NS) helped by strong domestic urban demand.

STOCKS TO WATCH:

** ITC (ITC.NS) missed profit estimates. The tobacco-to-hotels conglomerates revenue rose 3%, helped by a 10% surge in its cigarettes business.

** Tata Motors (TAMO.NS) will buy a 26.79% stake in digital logistics firm Freight Tiger for 1.50 billion rupees ($18 million), with the option to invest a further 1 billion rupees over the next two years.

** Zomato (ZOMT.NS): SoftBanks (9984.T) venture capital fund will sell a 1.1% stake in the food delivery firm, CNBC-TV18 reported.

($1 = 83.1650 Indian rupees)