GIFT Nifty crashes over 220 pts, signals weak start for Sensex and Nifty despite global rally; US Fed in focus

GIFT Nifty's November futures contract was trading at 22,588 around 8:00 am, down 224 points, or 0.98 percent, from yesterday’s close. Indian equities ended almost unchanged on Tuesday amid F&O expiry-related volatility, with the Sensex slipping 8.08 points, or 0.01 percent, to 73,598.67 and the Nifty declining 3.45 points, or 0.02 percent, to 22,749.75. Foreign institutional investors turned net buyers, purchasing equities worth Rs 4,240 crore, while domestic institutions sold shares worth Rs 1,250 crore.

Asian equities advanced on Wednesday as renewed enthusiasm for artificial intelligence-related stocks supported risk appetite ahead of earnings announcements from major technology companies. The recovery in Asian technology stocks followed overnight gains on Wall Street. MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.85 percent, while Japan's Nikkei rose 1.2 percent. South Korea's technology-heavy Kospi jumped more than 3 percent, leading gains across the region.

US equity futures were largely unchanged as investors awaited the Federal Reserve's policy announcement later on Wednesday. US equities ended higher on Tuesday, supported by a technology-led rally as the third-quarter earnings season gathered momentum and investors awaited the Federal Reserve's interest-rate decision. The Nasdaq Composite surged 308.43 points, or 1.18 percent, to 26,477.81, outperforming the other major indices as artificial intelligence-related stocks attracted buying interest.

The S&P 500 gained 45.83 points, or 0.60 percent, to 7,722.60, while the Dow Jones Industrial Average edged up 15.99 points, or 0.03 percent, to 52,377.57. Crude oil prices rose sharply on Wednesday after an attack on a refinery in Saudi Arabia renewed concerns over energy supplies from the Middle East. Brent crude futures climbed $1.48, or 1.3 percent, to $115.36 a barrel, while West Texas Intermediate rose $1.22, or 1.22 percent, to $101.12 a barrel.

The US Federal Reserve's policy decision later on Wednesday will be a key event for global financial markets. The central bank is widely expected to leave interest rates unchanged, with investors focusing on policymakers' guidance regarding the future trajectory of borrowing costs. Inflation remains a central concern for the Fed, particularly as the prolonged Middle East conflict and elevated energy prices threaten to keep price pressures high.

Ponmudi R, CEO of Enrich Money, said Indian equities are likely to remain cautious ahead of the Federal Reserve's policy decision, with investors also tracking global market movements and energy prices. He expects sentiment to remain guarded ahead of the announcement, despite the recovery in global equity markets. According to Ponmudi, the near-term direction of Indian equities will depend largely on the Fed's policy signals, movements in crude oil prices and foreign portfolio investor flows. He also expects volatility to persist as investors assess the implications of monetary policy developments and geopolitical uncertainty.