On Thursday, December 11, the Sensex and Nifty 50 are likely to begin the session on a positive note, supported by firm global cues following the US Federal Reserve’s latest decision. On Wednesday, the Fed announced its third straight rate reduction of 0.25 basis points, bringing the key policy rate down to about 3.6%, the lowest in almost three years, while indicating that the pace of future rate cuts could slow.
The GIFT Nifty was trading near the 25,960 mark, showing a premium of about 125 points, indicating a robust start to Indian markets.
In early trade, Asian markets rallied in response to the Fed’s decision, adding to the positive setup for Indian equities.
US Representative Bill Huizenga highlighted the growing economic and strategic importance of India-US relations, pointing to increased interest from American companies and the need for closer collaboration in the Indo-Pacific region. Speaking at a House Foreign Affairs Subcommittee hearing, he said India’s fast-growing economy presents significant opportunities but stressed the importance of fair market access. He added that a fresh trade agreement under President Trump and Prime Minister Modi would further deepen bilateral ties.
His comments came as India’s Foreign Secretary Vikram Misri met US Under Secretary Allison Hooker, who is on a five-day visit aimed at strengthening strategic and economic engagement between the two countries.
On Wednesday, December 10, Foreign Institutional Investors (FIIs) were net sellers, selling equities worth ₹1,651.06 crore. Domestic Institutional Investors (DIIs) continued their positive stance, buying equities worth ₹3,752.31 crore, marking their 34th consecutive session of net inflows.
Indian equity benchmark indices closed lower on Wednesday, December 10, as investors booked profits ahead of the much-awaited US Federal Reserve rate decision. The Nifty 50 slipped 81.65 points or 0.32% to end at 25,758, while the Sensex declined 275.01 points or 0.32% to close at 84,391.27, marking the third straight session of losses. Over the last three sessions, both indices are down about 1.6%, while India VIX remained largely unchanged.
On the sectoral front, Nifty IT emerged as the top loser, falling 0.89%, while Nifty PSU Bank and Financial Services also ended lower. Nifty Media gained 0.48% to lead the gainers, followed by metal and pharma stocks. In the broader market, selling pressure was sharper, with the Nifty Midcap 100 declining 1.12% and the Nifty Smallcap 100 falling 0.90%.
US equities closed in positive territory on Wednesday after the Federal Reserve announced a much-anticipated 25-basis-point interest rate reduction. Despite the central bank hinting at a pause in further easing, investors continued to price in the possibility of additional support. Policymakers said they would wait for clearer trends in employment and inflation, noting that price pressures are still above comfort levels.
The S&P 500 advanced 46.17 points, or 0.67%, to settle at 6,886.68, narrowly missing its October 28 all-time high. The Dow Jones Industrial Average surged 497.46 points, or 1.05%, ending at 48,057.75, while the Nasdaq Composite rose 77.67 points, or 0.33%, to close at 23,654.16.
The US Federal Reserve lowered its benchmark rate by 0.25 percentage points on Wednesday, marking the third consecutive reduction. However, officials signaled that further cuts may be paused in the coming months. The move brought the policy rate down to around 3.6%, its lowest level in nearly three years. While rate cuts typically reduce borrowing costs for home loans, vehicle financing, and credit cards, actual lending rates continue to depend on broader market conditions.
Fed Chair Jerome Powell said that after six rate reductions over the past two years, the central bank is now well-placed to assess how inflation and the labor market evolve. The latest quarterly projections from policymakers indicate expectations of just one additional rate cut next year.
The US dollar declined against major global currencies following the Fed’s rate cut and its signal of a potential pause in the easing cycle. The greenback slipped 0.8% against the Swiss franc to 0.8000 and weakened 0.6% against the Japanese yen to 155.92.
The euro strengthened 0.6% to USD 1.1691. Meanwhile, the dollar index, which measures the currency against a basket of peers including the euro and yen, fell 0.6% to 98.66.
Gold prices moved higher on Thursday following the Federal Reserve’s interest rate cut, even as policymakers remained split on the likelihood of further easing next year. Spot gold rose 0.3% to USD 4,242.39 per ounce by 0040 GMT, while February gold futures climbed 1.1% to USD 4,271.30.
Spot silver gained 0.9% to USD 62.31 per ounce after touching a record high of USD 62.67. Silver prices are up 113% so far this year, supported by strong industrial demand, declining inventories, and its addition to the US critical minerals list.
Crude oil prices advanced for a second consecutive session on Thursday after the United States seized a sanctioned tanker near Venezuela, raising concerns over potential supply disruptions. Brent crude increased 27 cents, or 0.4%, to USD 62.48 per barrel by 0101 GMT, while US West Texas Intermediate rose 33 cents, or 0.6%, to USD 58.79.
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