The Indian stock market is getting hammered right now. Indices extended their losses today—the third straight day of declines—as investors held their breath for clarity from the U.S. Federal Reserve.
The worry isn’t just today’s expected rate cut; it’s the Fed’s 2026 outlook that is the real trouble.
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Markets Slide on Fed Anxiety
The major benchmarks closed in the red, capping a weak three-day run.
Nifty 50 eased 0.32% to 25,758 points.
BSE Sensex eased 0.32% to 84,391.27 points.
The indices are down around 1.6% this week, mostly driven by persistent selling from foreign investors (FIIs). Higher U.S. rates, or the threat of higher rates, makes emerging markets like India less appealing.
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The Hawkish Cut
The Fed is widely expected to cut rates today. The problem is the forward guidance, the notorious “dot plot” that outlines future rate projections.
The Forecast: Experts are worried the median forecast for 2026 will be “way more hawkish than current market pricing,” according to Xiao Cui of Pictet Wealth Management. This means the Fed might signal only one rate cut in 2026, instead of the two or three the market is currently banking on.
The Effect: This uncertainty—a “hawkish cut”—means global liquidity stays tighter. This, plus delays in the India-U.S. trade deal, has added to the market jitters.
Sectoral Damage and Stock Shockers
The selling pressure was broad-based. Eleven out of 16 major sectors fell.
Heavyweights like financials and IT lost 0.5% and 0.9%, respectively.
The broader market was hit harder: Small-caps and mid-caps fell 0.9% and 1.1%.
The Shocker Stories
Meesho Soars: In the middle of the gloom, e-commerce firm Meesho had a blockbuster market debut, soaring 53.2%. The simple reason? Investors are backing its “asset-light, zero-commission” model.
IndiGo Turbulence: IndiGo slipped 3.3%. This followed a government order forcing the carrier to cut 10% of its planned flights after they racked up at least 2,000 cancellations last week. Operational chaos, and then the penalty followed.
AU Small Finance Bank Gains: On the positive side, AU Small Finance Bank gained 2.2% after it got government approval to lift the foreign investment limit to 74% from 49%. More foreign money means good news for the stock, or nothing.
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