Markets Slip At Open Despite Fed Rate Cut As Investors Turn Cautious

Indian equity markets began Thursday’s session on a subdued note, showing little reaction to the US Federal Reserve’s decision to trim interest rates by 25 basis points.

At the opening bell, both benchmark indices declined. The Sensex dropped 228 points, or 0.27 per cent, to 84,770, while the Nifty slipped 81 points, or 0.31 per cent, to 25,973.

Market experts noted that the Nifty retains a broadly stable-to-positive outlook as long as it stays above the 25,900–26,000 support region.

They further added, “On the upside, immediate resistance is placed around 26,100–26,200, and a sustained move above this range could pave the way for further gains toward 26,300–26,400 in the near term.”

Several large-cap counters came under pressure in early trade. Shares of Bharti Airtel, Sun Pharma, ITC, Tata Steel, Power Grid, Titan, Kotak Mahindra Bank, Infosys, Axis Bank, Trent, and HCL Tech were among the main drags, slipping as much as 1.5 per cent.

Meanwhile, a few blue-chip stocks managed to stay positive. L&T, Tata Motors, Bajaj Finance, TCS, Ultratech Cement, Adani Ports, Tech Mahindra, and SBI were among the top performers on the Sensex.

The cautious tone in domestic equities followed the Fed’s move to reduce the benchmark funds rate to a range of 3.75 to 4 per cent.

However, comments from Fed Chair Jerome Powell, suggesting that another rate cut in December was ‘not a given’, tempered investor optimism and weighed on global market sentiment, including across Asia.

In the broader indices, the Nifty MidCap index remained largely unchanged, while the Nifty SmallCap index edged up by 0.15 per cent.

Sectoral Trends

Among sectoral performers, the Nifty Pharma index registered the steepest decline, down 0.76 per cent.

The Nifty Metal and FMCG indices slipped 0.4 per cent each, while the Nifty Private Bank index fell 0.2 per cent.

The Nifty Realty index, however, defied the broader trend, rising 0.5 per cent in early deals.

Analysts advised traders to adopt a careful ‘buy-on-dips’ strategy during heightened volatility and mixed global signals, particularly when operating with leveraged positions.

Also Read: Musk Claims Grokipedia Will Surpass Wikipedia ‘By Several Orders Of Magnitude’