FX.co ★ Indian Markets Extend Losses for Fourth Session

The BSE Sensex experienced a decline of 277 points, or 0.3%, settling at 84,861 in the trading session on Wednesday morning. This marks the fourth consecutive session of decline as traders adopted a cautious approach ahead of the Reserve Bank of India's (RBI) anticipated interest rate decision scheduled for Friday. Current market forecasts predict that the central bank will likely reduce interest rates by 25 basis points due to the easing inflationary pressures. Additionally, investors are closely monitoring the forthcoming US PCE inflation data, which is expected to influence the Federal Reserve's monetary policy decisions next week. Market sentiment was also dampened by ongoing foreign capital outflows and uncertainties surrounding the US–India trade agreement. Nevertheless, positive momentum from an upbeat session on Wall Street overnight mitigated some losses, underpinned by increasing speculation about potential rate cuts by the Federal Reserve, with markets estimating an 89% probability of such measures. On the data side, the PMI for India's private sector was slightly adjusted downward, reflecting the weakest performance in six months. The decline was primarily driven by the auto, banking, and metal sectors, with significant drops in Axis Bank, HDFC Bank, and Reliance Industries, each falling by 1.3%, and ICICI Bank decreasing by 1.2%.