- Indian markets opened cautiously, awaiting the RBI’s policy decision.
- Rate hike widely anticipated; inflation, high crude oil persisted.
- Asian markets fell, but US stocks closed higher.
Indian benchmark indices experienced a cautious start on Wednesday as investors awaited the outcome of the Reserve Bank of India’s Monetary Policy Committee (MPC) meeting, while elevated crude oil prices remained a key concern.
The BSE Sensex crashed more than 400 points and tested 72,650, while the NSE Nifty50 fell over 160 points and hovered near 22,600, as of 9:15 AM.
GIFT Nifty Signals Cautious Start Ahead Of RBI MPC Decision
The GIFT Nifty was indicating a subdued opening for the Nifty50, with futures quoted at 22,733, down 63 points. The domestic market is likely to remain focused on the RBI’s policy decision and the central bank’s assessment of inflation and interest rates.
At around 9:01 AM in the pre-open session, the Sensex was at 73,481.02, up 413.21 points or 0.57 per cent. The Nifty, meanwhile, was at 22,769.90, down 6.20 points or 0.03 per cent.
Market expectations are centred on the possibility of a 25 basis point repo rate hike in the October policy review. However, some experts believe the RBI could opt to keep rates unchanged, particularly given the potential impact of higher borrowing costs on housing demand.
Suresh H A, Managing Director of Sanjeevini Group, said a rate hike could affect homebuyer sentiment and affordability, especially after property prices have risen across major residential markets.
He said the festive quarter is an important period for residential sales and that keeping interest rates stable could help maintain buyer confidence. According to him, even a small increase in home loan rates could influence purchase decisions among first-time and mid-income buyers.
RBI MPC: Markets Watch Inflation, Rate Outlook
Saurav Ghosh, co-founder of Jiraaf, a Sebi-registered online bond platform, said the combination of higher global bond yields, elevated energy prices and rising food-price pressures after a weaker monsoon has strengthened the case for a rate increase.
He said a 25 bps hike is already largely priced in, with markets also factoring in at least 50 bps of cumulative tightening by December.
Ghosh said the RBI’s communication could prove more important than the immediate rate decision, particularly its assessment of how persistent inflationary pressures are and whether higher energy and food prices are feeding through to the broader economy.
“If these pressures remain elevated into early 2027, the possibility of an additional 25 bps hike next year could come into consideration,” he said.
For bond investors, Ghosh recommended spreading investments across different maturities and credit ratings rather than concentrating exposure at one point in the interest-rate cycle.
Asian Markets Trade Lower; US Stocks End Higher
Asian equities were largely under pressure in early trade, with the Nikkei 225 down 0.36 per cent and the KOSPI falling 0.76 per cent. Crude oil prices hovering around the $100-per-barrel level continued to weigh on sentiment.
In the US, equities ended higher after the S&P 500 and Nasdaq 100 touched fresh highs. The S&P 500 rose 0.58 per cent, while the Nasdaq 100 gained 0.48 per cent, supported by AI-related stocks. The Dow Jones Industrial Average advanced 0.49 per cent.
The benchmark 10-year US Treasury yield stood at 5.3 per cent, keeping global bond-market movements in focus for investors.
Crude Oil Near $100 Keeps Pressure On Markets
Brent crude remained elevated as concerns over supply added to the pressure on oil prices. Reports of a storm moving towards the US oil-producing region also contributed to the rise.
December Brent futures were quoted at $101.54 per barrel, up 0.95 per cent on the Intercontinental Exchange.
The elevated crude price remains an important factor for Indian equities as investors assess its potential implications for inflation and the broader economic outlook.
Gold, Silver Prices Edge Lower
In the commodities market, precious metals traded lower. Gold futures declined 0.35 per cent, while silver futures fell 0.6 per cent.
With the RBI policy decision due during the day, investors are likely to track both domestic rate signals and global cues as they assess the direction of equities in the near term.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: abplive.com
