Indian Stock Markets Inch Cautiously Ahead of Key US Fed Meeting

Indian stock markets commenced the week cautiously on Monday, with both main indices experiencing slight declines during the opening session. Anticipation surrounds the US Federal Reserve meeting beginning Tuesday, where a 25 basis points rate cut is expected by market analysts worldwide. The Nifty 50 index began at 24,753.40 points, marking a decline of 14.90 points or 0.06 percent, while the BSE Sensex opened with a dip of 132.81 points or 0.16 percent to stand at 82,000.31 points.

Market experts emphasize the significance of the Fed rate cut, expected this week, and predict a consolidation phase, with optimism for a year-end rally gaining momentum. Banking and Market Expert Ajay Bagga told ANI that the current week will be heavily influenced by the US Fed's final FOMC meeting of the year, with a 25 basis points rate cut almost certain. The Fed's commentary will be scrutinized for future rate cut trends, while January 2025 will spotlight President Trump's policies. Following a week of consolidation, Indian markets displayed a sharp intraday bounce on Friday, and steady action is expected given the focus on Fed policy this week.

Sectoral indices such as Nifty FMCG, Nifty Media, Nifty Metal, Nifty Pharma, Nifty PSU Bank, and Nifty Realty witnessed gains, while sectors including Nifty Bank and Nifty Auto declined. In the Nifty 50, 19 shares gained against 30 losers, with top performers being ITC, Cipla, L&T, Reliance, and Adani Enterprises; BPCL, JSW Steel, and Tech Mahindra were top losers.

Akshay Chinchalkar, Head of Research at Axis Securities, noted the critical market support levels and highlighted seasonal patterns supporting a bullish outlook. Over the last decade, the Nifty has risen 80% of the time in the second half of December. In other Asian markets, a mixed trend was observed; the Nikkei 225 index, Taiwan Weighted index, and South Korea's KOSPI index saw slight gains, while the Hang Seng index and Jakarta Composite fell at the report's filing time.

(With inputs from agencies.)