| The key equity benchmarks traded in a narrow range with a mixed bias in early trade as investors assessed the US Federal Reserve’s latest policy decision and its implications for global liquidity. The Fed’s 25-basis-point rate hike, which took the benchmark rate to 3.75%-4%, kept risk appetite subdued, while a stronger dollar continued to weigh on Asian currencies, including the rupee.
The Fed’s indication of another rate hike in 2026 is likely to keep investors cautious, particularly in rate-sensitive and foreign-portfolio-investment-driven segments. However, buying interest in select domestic sectors provided some support, with the Nifty holding above the 23,200 mark. Market participants are likely to track currency movements, US bond yields and foreign fund flows for further direction.
Auto, PSU Bank and metal shares advanced while IT and private bank stocks declined.
At 09:25 IST, the barometer index, the S&P BSE Sensex declined 30.07 points or 0.03% to 74,292.43. The Nifty 50 index rose 15.50 points or 0.07% to 23,239.80.
The broader market outperformed the frontline indices. The BSE 150 MidCap Index added 0.28% and the BSE 250 SmallCap Index advanced 0.47%.
The market breadth was strong. On the BSE, 2,120 shares rose and 790 shares fell. A total of 196 shares were unchanged.
Foreign portfolio investors (FPIs) sold shares worth Rs 2,032.61 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 3,908.23 crore in the Indian equity market on 16 September 2026, according to provisional data.
Numbers to Track:
The yield on India's 10-year benchmark federal paper rose 0.41% to 7.084 compared with the previous session close of 7.055.
In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 96.0650 compared with its close of 95.9100 during the previous trading session.
MCX Gold futures for 5 October 2026 settlement fell 0.80% to Rs 1,51,231.
The US Dollar Index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.08% to 100.33.
The United States 10-year bond yield fell 0.04% to 5.002.
In the commodities market, Brent crude for the November 2026 settlement fell 29 cents or 0.27% to $105.54 a barrel.
Stocks in Spotlight:
Infosys shed 0.40%. The IT major announced the expansion of its Indore Development Center (DC) to strengthen its presence in Central India, with enhanced capabilities in AI, cloud, cybersecurity and next-generation digital services.
Alembic Pharmaceuticals rose 0.74%. The company announced that the US Food and Drug Administration (USFDA) has issued an Establishment Inspection Report (EIR) and closed the inspection of its bioequivalence facility in Vadodara, Gujarat. The USFDA conducted the inspection from 3 March to 7 March 2025.
G R Infraprojects fell 0.96%. The company announced that it has issued a notice of termination to NTPC for the project EPC package for battery energy storage system (BESS) implementation at NTPC's Mouda Super Thermal Power Station.
Global Markets:
The US Dow Jones futures were up around 343 points on Thursday, pointing to a stronger opening for US equities after Wall Street ended sharply lower in the previous session following the Federal Reserve's policy decision. The Fed raised interest rates for the first time in three years and signalled that another rate hike could come before the end of 2026.
Asian equities traded mixed on Thursday as investors assessed the Fed's rate hike and easing crude oil prices.
Oil prices eased on signs that Saudi Arabia was working to restore crude flows following damage to its East-West pipeline. Reports that Saudi Arabia was arranging additional crude shipments via Oman helped reduce immediate concerns about supply disruptions.
The Saudi East-West pipeline, which provides an alternative route for moving crude away from the Persian Gulf, was damaged in a drone attack launched from Iraq, according to reports. Saudi Arabia had shut the pipeline following the attack, raising concerns about further pressure on an already-tight global oil market. The US administration subsequently indicated that operations would resume, easing some of the supply-risk premium in crude prices.
The gains in parts of Asia came after a heavy sell-off on Wall Street on Wednesday. The Dow Jones Industrial Average fell 631.21 points, or 1.21%, to 51,461.90, while the S&P 500 declined 0.45%. The Nasdaq Composite was broadly flat.
The Federal Reserve raised its benchmark federal funds target range by 25 basis points to 3.75%-4%, marking its first rate increase since July 2023. The decision reflected the Fed's concern that inflation remains elevated despite resilient economic activity and labour-market conditions. Fed Chair Kevin Warsh said inflation was still too high and that monetary policy would remain focused on preventing higher energy prices from generating broader inflationary effects.
The Fed's updated projections point to another rate increase in 2026. Sixteen of the 19 officials indicated support for at least one further hike this year, while the median projection put the policy rate at 4.1% at the end of 2026. The median forecast also showed the rate remaining at 4.1% in 2027.
The central bank raised its inflation outlook, with the median forecast for headline PCE inflation at 3.7% for 2026, well above its 2% target. Core PCE inflation was projected at 3.4%. At the same time, the Fed raised its 2026 GDP growth forecast to 2.3%, while the median unemployment-rate projection was 4.1%. |