Market Open: Sensex, Nifty Gain Despite Weak IT Stocks After US Fed Move

Markets Today: Sensex, Nifty Edge Higher; IT Stocks Under Pressure After Fed Rate Hike

Indian equity benchmarks opened marginally higher on Thursday, September 17, as investors assessed the impact of the US Federal Reserve’s latest rate hike and mixed signals from global markets. The Nifty remained above the 23,200 mark, while the Sensex traded around 74,300 in early deals.

At 9:32 am, the Nifty stood at 23,274.80, gaining 58 points or 0.25%. The Sensex was at 74,466.31, up 131.74 points.

Broader Markets Outperform

The broader market opened on a firmer note compared with the headline indices. Nifty Midcap Select rose 0.46%, while Nifty Midcap 50 gained 0.34%.

The Nifty Smallcap 100 advanced 0.40%, and the Nifty Next 50 climbed 0.40%.

Meanwhile, the India VIX declined 2.62% to 12.82, indicating relatively softer volatility in the early session.

Metal, Auto and PSU Banks Lead Sectoral Gains

Among sectoral indices, Nifty Metal gained 0.50%, while Nifty Chemicals rose 0.47%. Nifty PSU Bank added 0.44% and Nifty Auto advanced 0.42%.

The IT sector, however, remained under pressure. Nifty IT declined 0.48%, while Nifty Media slipped 0.18% and Nifty Private Bank fell 0.10%.

In the Sensex basket, BEL, Eternal and Bajaj Finance were among the notable early gainers. On the losing side, HDFC Bank, HCL Technologies, TCS, Infosys and Titan traded lower.

Fed Rate Hike Keeps Investors Cautious

Global markets remained focused on the US Federal Reserve’s decision to raise interest rates by 25 basis points, taking the federal funds target range to 3.75%-4%.

The Fed also indicated that another rate increase could be possible later this year, while inflation continues to remain above the central bank’s comfort level.

The relatively hawkish stance supported the US dollar and pushed short-term Treasury yields higher, creating pressure on risk-sensitive assets. Asian markets showed a mixed trend in early trading, while US stock futures indicated a firmer start.

Dollar, Yields and Crude Remain Key Risks for India

Indian markets continue to face pressure from a combination of higher US yields, a stronger dollar, elevated crude oil prices and weakness in the rupee.

The rupee opened at around Rs 96.01 per US dollar on Thursday, compared with Wednesday’s close of Rs 95.95.

Crude oil prices, meanwhile, eased from their recent highs, with Brent crude trading around $105 a barrel in the latest session. The decline offered some relief to India, which remains heavily dependent on crude oil imports.

Analyst Sees Continued Market Volatility

Ponmudi R, CEO of Enrich Money, said Indian equities could remain vulnerable following the Fed’s 25-basis-point rate increase and its indication of another possible hike.

According to him, elevated US Treasury yields, high crude prices and continued weakness in the rupee could keep investor sentiment cautious in the near term.