On Thursday, September 25, equity benchmark indices Sensex and Nifty 50 are likely to open lower, tracking the overnight decline on Wall Street after comments from the US Fed Chair on equity market valuations. At 7:09 AM, the GIFT Nifty was trading at 25,062, down 57 points.
Talking about domestic cues, the Reserve Bank of India (RBI) in its monthly bulletin, said that ongoing goods and services tax (GST) reforms are expected to ease retail prices and support consumption growth. The RBI noted that these reforms will help improve the ease of doing business and strengthen demand drivers.
While festive demand and GST-led reforms are expected to provide some support, global headwinds, currency weakness, and uncertainty over the India-US trade deal would keep the markets on the backfoot in the near term.
In early trade, Asian markets opened mixed, while U.S. equities closed lower overnight, extending their decline for the second consecutive session.
On Wednesday, September 24, Foreign Institutional Investors (FIIs) were net sellers. FIIs sold equities worth ₹2,425.75 crore.
Domestic Institutional Investors (DIIs) were buyers on Wednesday. DIIs bought equities worth ₹1,211.68 crore, marking their 22nd consecutive session of net buying.
On Wednesday, September 24, Indian equity benchmarks extended their losing streak for the fourth consecutive session, with the Nifty 50 closing 112.60 points lower at 25,056.90 and the Sensex shedding 386.46 points to settle at 81,715.64. Banking majors HDFC Bank and ICICI Bank weighed heavily on the indices, while the India VIX cooled by 1.03%, indicating some easing in market volatility.
Sectorally, all indices ended in red except FMCG, with Nifty IT falling 0.72% and Nifty Auto slipping over 1% after hitting record highs a day earlier.
Broader markets mirrored the weakness as both Nifty Midcap and Small-cap indices extended losses for the third day.
US stocks ended lower for a second straight session on Wednesday as investors booked profits with benchmarks trading close to record levels. The weakness followed comments from Federal Reserve Chair Jerome Powell, who suggested that equity valuations might be stretched, and came ahead of key inflation numbers due later this week.
The Dow Jones Industrial Average slipped 171.50 points, or 0.37%, to close at 46,121.28. The S&P 500 dropped 18.94 points, or 0.28%, finishing at 6,637.98, while the Nasdaq Composite declined 75.62 points, or 0.33%, to 22,497.86.
Sales of new US single-family homes surged 20.5% to a seasonally adjusted annualised rate of 800,000 units in August. The sales pace for July was revised higher to a rate of 664,000 units from the previously reported pace of 652,000 units.
Gold prices rebounded, driven by expectations of further US interest rate cuts, geopolitical risks, and a slightly weaker dollar. As of 7:13 am IST, Spot gold is 0.1% higher at $3,737.94/oz, while on Tuesday, MCX gold futures climbed 1.74% to a fresh record all-time high of ₹114,179 per 10 grams.
WTI crude futures fell below $65 per barrel and Brent crude futures fell to around $69 per barrel on Thursday as investors took profits after a rally to a seven-week high.
The US Dollar Index, which tracks the currency’s performance against a basket of six major peers, is hovering around 97.813, close to its highest level in the last three weeks.
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