SGX Nifty, Asian markets fall after Fed rate hikes: Powell's commentary, dollar movement, FPI flow trend & more

Domestic stocks are likely to see weak start to Thursday’s trade after the US Federal Reserve hiked policy rate by 50 basis points overnight and hinted at more rate hikes, even if there is a recession in the world's largest economy. Asian markets were trading lower in early trade while dollar was quoting flat. Here's what you should know before the Opening Bell: 

Market outlook

For Nifty, support for the day is seen at 18,550 while the resistance is seen at 18,800. Nifty Bank is expected to trade in the 43,700-44,600 range. Prabhudas Lilladher said the index is seeing hurdle at 18,700 and while it is maintaining support near 18,650 levels, with bias positive. The daily trend has turned up after 8 days, it said.

SGX Nifty signals a weak start 

Nifty futures on the Singapore Exchange quoted 60 points, or 0.32 per cent, lower at 18,690, hinting at a weak start for the domestic market on Thursday.

Asian markets fall after Fed rate hike

Asian shares lost ground on Thursday after the US Federal Reserve raised interest rates by an expected 50 basis points but projected higher rates for a longer period. Among global markets, Japan's Nikkei was down 0.22 per cent, China's Shanghai Composite fell 0.3 per cent while Hong Kong's Hang Seng declined 1.80 per cent. Korea's Kospi slipped 0.89 per cent. Australia's S&P/ASX 200 index fell 0.4 per cent after gaining 0.7 per cent on Wednesday.

US stocks settle lower in volatile trade

US stocks closed lower in volatile trading on Wednesday following a policy announcement by the Federal Reserve that raised interest rates by an expected 50 basis points, but its economic projections see higher rates for a longer period, Reuters reported. Dow Jones Industrial Average index fell 142.29 points, or 0.42 per cent, to 33,966.35, S&P500 index lost 24.33 points, or 0.61 per cent, to 3,995.32 and Nasdaq Composite index dropped 85.93 points, or 0.76 per cent, to 11,170.89.

Dollar flat despite Fed's Hawkish stance

The dollar was on the back foot on Thursday, even as the Federal Reserve kept to its hawkish rhetoric after raising rates by half a percentage point, as investors were doubtful over how much the central bank would commit to putting the brakes on growth to curb inflation, Reuters reported. Against a basket of currencies, the US dollar index was last 0.02 per cent higher at 103.68, after touching a six-month low in the previous session.

Powell says Fed to hike rates despite recession fears

Fed Chair Jerome Powell said overnight that the Fed will deliver more interest rate increases next year despite a possible recession in the US, with rates expected to peak above 5 per cent. Recent signs of slowing inflation have not brought any confidence yet that the fight has been won, Powell told reporters after the Fed's policy-setting committee raised its benchmark overnight interest rate by half a percentage point and projected it would continue rising to above 5% in 2023, a level not seen since a steep economic downturn in 2007.

Stocks in F&O ban

Shares of BHEL, Delta Corp, GNFC and Indiabulls Housing are banned in the F&O segment today. Derivative contracts in a security are banned when it crosses 95 per cent of the market-wide position limit (MWPL). No new positions can be created in the derivative contracts of said security. This prohibition is lifted when the open interest in the stock drops below 80 per cent of the MWPL across exchanges.

DIIs buy shares worth Rs 926 crore

Provisional data available with NSE suggests FPIs were net buyers of domestic stocks to the tune of Rs 372.16 crore on Wednesday. Domestic institutional investors (DIIs) were buyers of equities to the tune of Rs 926.45 crore.

Rupee gains 11 paise against dollar

The rupee gained 11 paise to settle at 82.49 against the dollar on Wednesday as a positive trend in domestic equities and easing inflationary pressures strengthened investor sentiment, PTI reported. Besides, a weak greenback against its major rivals overseas and softening crude oil prices supported the domestic unit, forex traders said.