Markets likely to start on a negative note amid downbeat global cues

Key benchmark indices are expected to open on a pessimistic note amid negative global cues. Nifty 50 index futures on the Singapore stock exchange is currently trading with a loss of 27 points at 10,818.  

Most Asian indices are down on Thursday tailing overnight weakness on the Wall Street, which ended in negative territory after the Federal Reserve's announcement of a rate hike and hawkish outlook on inflation and interest rates. Japan’s Nikkei 225 Index has lost 0.46%, Hong Kong’s Hang Seng Index has dipped 0.20%, while China’s Shanghai Composite has surged 0.47%. 

Back home, despite an optimistic start, the frontline indices gave away most of their gains as selling pressure was seen in the final hour of the session and the markets ended Wednesday’s session with marginal gains. The BSE Sensex rose 47 points to close at 35,739, while the Nifty was up by 14 points to end the day at 10,857. The broader markets ended the session with modest losses as Nifty Mid-cap and Small-cap indices shed 0.35% and 0.21%, respectively. Sector-wise, Nifty PSU Bank and Nifty IT were top gainers, while Nifty Media and Nifty FMCG ended with losses.  

The US stock benchmarks pared earlier gains to close in the red on Wednesday following the Federal Reserve’s monetary policy announcement. The US Fed on Wednesday raised the Fed Fund rates by 25 basis points to the range of 1.75 per cent to 2 per cent. While the rate hike was no surprise, the Fed surprised market participants by forecasting a total of four rate hikes this year instead of three. The Dow Jones Industrial Average slipped 120 points to close at 25,201, the S&P 500 lost 11 points to finish at 2,776 and the Nasdaq Composite dipped 8 points to end at 7,696.  

The European stock indices ended a choppy day on a mixed note on Wednesday. The DAX of Germany gained 0.38%, the CAC 40 of France fell 0.01% and the FTSE 100 closed unchanged.