Market uncertainties persist as significant global issues remain unresolved. Foreign investors are continuing to pull out of the Indian market, creating further pressure. Although the Indian rupee strengthened slightly yesterday, the broader pressure on the currency remains. Meanwhile, US-India trade talks are set to begin in Delhi. The US Federal Reserve will announce its interest rate decision tonight, and with such uncertainty, the Indian market is expected to open weak today.
Microsoft has announced a significant $1.75 billion (₹1.57 lakh crore) investment in India’s artificial intelligence sector, marking the largest such investment the company has made in Asia. This was disclosed after a meeting with Prime Minister Narendra Modi, where CEO Satya Nadella shared this exciting news.
Tonight, the US Federal Reserve will release its interest rate decision and the "dot plot" evaluating both interest rate and growth projections. The market expects a 0.25% reduction in rates, continuing the pattern from the last two meetings. However, the expectation is that further rate cuts may not happen immediately.
Jerome Powell, the current chairman of the Federal Reserve, will retire next May. It is expected that Kevin Hassett, a member of the White House Economic Advisory Council, will take over. The market is now wondering whether the new chairman will continue to cut interest rates as expected. Any significant cuts in May or June could surprise the markets.
If the US cuts interest rates, it could lead to an increase in stock and gold prices, with more capital flowing into emerging markets. This year, US funds have already been redirected to China, Vietnam, and Latin America, while pulling out from India.
In the Indian stock market, Nifty closed at 25,920 on Wednesday night, but dropped to 25,885 by morning. Based on current signals, the Indian market is expected to start weak today.
European markets were mixed on Tuesday, with most national indices and the pan-European STOXX 600 falling. However, Germany’s index rose by half a percentage point. Europe’s direction will likely become clearer after the US Federal Reserve's decision tonight. Switzerland and the UK will announce their monetary decisions in the coming days. The European Central Bank’s decision will also be revealed next week. Esilor Luxottica, the maker of Ray-Ban sunglasses, saw its stock drop by 5.7% after announcing that it had partnered with Meta to create AI-driven smart eyewear.
US stock indices moved in mixed directions yesterday. JPMorgan Chase raised its expense estimate for next year, causing the Dow Jones to fall by 0.38%. The S&P 500 remained virtually unchanged, while the Nasdaq gained slightly.
On Wednesday, the Dow Jones dropped by 179.03 points (0.38%) to 47,560.29, and the S&P 500 fell by 6 points (0.09%) to 6840.51. However, Nasdaq Composite gained 30.58 points (0.13%), closing at 23,576.49.
This morning, US futures are in the red. Dow is down by 0.05%, S&P 0.10%, and Nasdaq by 0.20%.
Asian markets started off positively but soon turned into losses. Japan’s Nikkei, Australia’s ASX, and South Korea’s Kospi indices initially rose but reversed course and fell. The markets are waiting for China’s November inflation data, which will be released later today. Chinese markets started off with a decline this morning.
The Indian market was affected by several factors, including trade talks, the rupee, and foreign selling. Nifty and Sensex both initially dropped by significant margins, but later rebounded, although both indices closed the day with losses of about half a percent. Mid and small-cap stocks performed better, with small-cap indices closing over 1% higher.
Foreign investors continued to sell heavily yesterday, with net outflows amounting to ₹3,760.08 crore in cash markets. Domestic funds also witnessed a net outflow of ₹6,224.89 crore.
Nifty closed at 25,839 and Sensex at 84,382 after hitting lows earlier in the day. All sectors started lower, but the trend reversed with the real estate, defense, public-sector banks, tourism, and consumer durable sectors closing in the green. IT, auto, pharma, healthcare, and financial services saw declines.
On Tuesday, Sensex closed 436.41 points (0.51%) lower at 84,666.28, while Nifty ended down 120.90 points (0.47%) at 25,839.65. The Bank Nifty closed with a minimal loss of 16.20 points (0.03%) at 59,222.35. However, the Midcap 100 index rose by 0.32%, and the Small Cap 100 index surged by 1.14%.
The broader market sentiment is mixed, with 2,550 stocks rising on the BSE and 1,625 falling. On the NSE, 1,983 stocks advanced, while 1,119 fell.
Looking ahead, Nifty is expected to find support at 25,700 and 25,625, while resistance lies at 25,900 and 26,000. The broader market sentiment suggests positive movement in the coming days.
The US delegation for trade talks and the assistant secretary of defense for cooperation are in Delhi, with the progress expected to be known by Friday. The market is viewing the ongoing talks positively. Despite President Trump’s threat of imposing tariffs on Indian rice, the market seems to be downplaying the impact, as rice exports to the US are minimal.
JSW Steel and Tata Steel saw their profit expectations downgraded by foreign brokerages. The target price for JSW Steel has been reduced from ₹1,400 to ₹1,300, and for Tata Steel from ₹210 to ₹200. Despite this, both stocks retain a "buy" recommendation.
In the broader market, the SEBI extended the claim period for investors in Karvy Stock Broking until March 2026. Additionally, Dileep’s Bilcon has secured a 25-year bauxite mining deal in Nalco, and Andhra Pradesh has awarded a ₹328.78 crore contract for national highways toll collection.
Gold prices remain volatile as investors await the Federal Reserve’s interest rate decision. Gold peaked at $4,220 an ounce but dropped to $4,169 before recovering to $4,209.20 by the close. This morning, gold is trading at $4,216 per ounce. In Kerala, 22-carat gold dropped by ₹720 to ₹94,920 per pavan on Wednesday.
Silver prices surged by 4.5%, closing at $61.11 per ounce and reaching a record high. This morning, silver is trading at $61.05 per ounce.
Industrial metals saw sharp declines yesterday. Copper dropped by 1.12% to close at $11,563.50 per ton, while aluminum fell by 1.18% to $2,853.80 per ton. Zinc prices increased, but nickel, lead, and tin all fell.
Rubber prices fell by 0.17%, reaching $1.71 per kilogram in international markets. Cocoa rose by 0.95%, while coffee saw a slight decline of 0.75%. Tea prices remained unchanged, and palm oil dropped by 0.24%.
The US Dollar Index continued to rise, closing at 99.22 on Wednesday. This morning, it is slightly down at 99.21. The US Dollar saw a minor rise against the Euro, Pound, and Japanese Yen.
Crude oil prices have declined, with Brent crude falling by 1% to $61.94 per barrel. This morning, Brent crude is at $62.04, while WTI is at $58.37, and UAE’s Murban crude is at $63.65. Natural gas prices fell by 6% to $4.58.
Cryptocurrency markets saw strong gains, with Bitcoin rising above ₹92,300. Ethereum surged by 6% to $3,300, while Solana climbed above $138.
