Ahead of the US Fed’s decision, a bullish trend is being seen in the American market. According to Indian time, at 8.30 pm, Dow Jones was trading with a rise of 160 points (half percent). Tech-based index Nasdaq is flat while broader market index S&P 500 is up 0.15 percent. Tonight, an announcement regarding interest rates will be made by the Monetary Policy Committee of the US Federal Reserve.
Expectation to maintain interest rates
The market believes that the Federal Reserve will maintain the interest rates. However, Fed chief Jerome Powell is serious about bringing inflation down to 2 percent. In such a situation, his statement on how the Federal Reserve views inflation in the coming time and what kind of steps can be taken for it will set the market sentiment.
Good decline in dollar index and bond yield
The dollar index has declined by 0.3 percent to the level of 104.5. This is news of relief for the market. There is also a decline of about 1 percent in the 10-year American bond yield and it is at the level of 4.32 percent. Brent crude is flat and is at the level of $ 94.3 per barrel. The action of the bond market is showing that the Fed chief’s statement will no longer be too hawkish.
What did Motilal Oswal say about Fed’s decision?
Motilal Oswal said that now the Federal Reserve can put an end to the aggressive stance. In fact, despite the continuous efforts of the Fed, the American economy is showing strength. The pace of demand has maintained, which has kept inflation high. Recent data has now started indicating that it is starting to have a negative impact on the labor market.
Further decline possible in Indian market
Before the Fed’s decision, there was a huge decline in the Indian market. Sensex fell by almost 800 points. Sensex closed at 66800 points and Nifty at 19901 points. Deepak Jasani, Head of Retail Research, HDFC Securities, said that the pressure on the market has increased. The next support for Nifty will be 19867 level and after that 19645 level. Brokerage’s technical analyst Nagaraj Shetty said that further decline in the market is possible. In the near term, Nifty can take support at the level of 19750-19600. If there is a bullish trend, there will be a resistance at the level of 20050-20100.