Sensex Falls Nearly 150 Points To Stall A 4-Day Winning Streak

Indian equity benchmarks opened lower, stalling a four-session winning streak as investors were on tenterhooks ahead of the US Federal Reserve’s policy decision later in the day, with many looking for any indications of a slowdown in future rate hikes.

The BSE Sensex index fell 140.5 points to 60,980.85, and the broader NSE Nifty index declined 36 points to 18,109.40, in a highly volatile trading start to the session.

Asian shares started Wednesday on a cautious note, tracking lower Wall Street stocks overnight, and a weaker dollar added to the complexity of the trading pattern, with high volatility the norm for the day.

Early trade moves saw a slight decline in MSCI’s broadest Asian-Pacific shares outside of Japan, driven by a fall in Chinese blue-chips and Hong Kong shares offsetting a rise in South Korea and Australia.

The US central bank is scheduled to announce its policy statement, with investors closely eyeing the remarks from Fed Chair Jerome Powell for any indication that policymakers are considering slowing the rate hikes path.

Traders were divided on the quantum of the December hike, with the futures markets pricing in a 44.5 per cent probability of a 50-basis-points (bps) increase.

“We suspect Chair Powell will try very hard to avoid saying anything that might be misconstrued as a signal that the inevitable step down in the size of tightening is a pivot toward the end of the tightening cycle,” Kevin Cummins, Chief US Economist at NatWest Markets, told Reuters.

“Given that the inflation-related data have yet to show any signs of any moderation, we lean a bit more toward officials holding off from signalling they are reducing the size of hikes just yet.”