Indian shares fall ahead of Fed rate decision
Updates for morning trade
By Hritam Mukherjee
Dec 18 (Reuters) -Indian shares declined on Wednesday, extending losses from the previous session, as investors braced for the FederalReserve's final monetary policy decision for the year, which will be closely monitored forclues on its future rate-cut path.
The Nifty 50 .NSEI was down 0.5%at 24,211 points as of 11:10 a.m. IST, while the BSE Sensex .BSESN fell 0.54% to 80,244.
The indexes fell more than 1% on Tuesday, bogged down by foreign outflows, withthe Nifty 50 closing below its 50-day moving average.
Twelve of the 13 major sectoral indexes were trading lower on the day.The more domestically-focussed small .NIFSMCP100 and midcaps .NIFMDCP100 both were both down 0.4%.
"Investor caution, likely from foreigners, persists... with an eye out for how hawkish will the Fed be in 2025 in terms of rate reductions," said Ruchit Jain, head of technical research at Motilal Oswal Financial Services.
Foreign investors offloaded Indian stocks worth about 64.1 billion rupees ($755 million) on a net basis on Tuesday, exchange datashowed.
While aquarter-point ratecut from the Fed isnear-certain later in the day, investors are jittery about the central bank's rate outlook in 2025 due to sticky inflation in the United States and a relatively strong economy. Markets will keep a keen eye on anycautious commentary from the Fed.
U.S. rate cutstypically help emerging market assets, such as Indian equities, as they boost foreign inflows.
On the day, Nifty 50 heavyweights HDFC Bank HDBK.NS and ICICI Bank ICBK.NS dropped over 1% and were the biggest drags on the index.
Online payments firm MobiKwik ONEM.NS soared 80% and budget retailer Vishal Mega Mart VSSL.NS jumped 37% in their respective trading debuts.
TPG-backed drugmaker Sai Life Sciences SAIE.NS gained 28% in its market debut.
($1 = 84.9040 Indian rupees)
Reporting by Hritam Mukherjee in Bengaluru; Editing by Sherry Jacob-Phillips and Sonia Cheema
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