Red Start For Sensex And Nifty, Fed Move And Global Tensions Spook Investors

Mumbai: Indian equity benchmarks opened lower on Thursday as the US Federal Reserve’s interest-rate increase and geopolitical tensions weakened investor sentiment.

The BSE Sensex opened at 74,182.62, falling 150 points, or 0.21%. The NSE Nifty 50 began trading at 23,195.25, down 22.35 points, or 0.10%.

Fed decision pressures markets

The US Federal Reserve raised interest rates by 25 basis points, matching market expectations. However, its hawkish policy stance, persistent inflation and the resilience of the American economy indicated that financial conditions could remain tight.

Fed official Kevin Warsh said inflation had remained excessively high for too long and reiterated the central bank’s commitment to restoring price stability.

US 10-year Treasury yields hovering near 5% could remain a challenge for global equity markets. Strong corporate earnings and steady economic growth in the US may offer some support.

Media and IT stocks fall

Nifty Media emerged as the biggest sectoral laggard, declining nearly 1% in early trading. Nifty IT slipped 0.56%, while Nifty Consumer Durables fell 0.31%.

Private Bank, MidSmall IT and Telecom, MidSmall Financial Services and Pharma indices also traded lower.

In contrast, Nifty PSU Bank gained 0.37%, Chemicals rose 0.22%, Oil and Gas advanced 0.17%, and FMCG increased 0.13%.

FII selling continues

Foreign institutional investors sold Indian equities worth about ₹2,000 crore in the previous session. Domestic institutional investors provided support by purchasing shares worth nearly ₹3,900 crore.

Crude oil prices eased marginally but remained elevated amid geopolitical uncertainty. Brent crude declined 0.2% to $105.62 per barrel, while US West Texas Intermediate crude slipped 0.3% to around $102.

Investors are expected to track global bond yields, foreign fund flows, crude oil prices and geopolitical developments for direction in the Sensex and Nifty.