Local-Markets

Sensex Drops 800 Points, Nifty Falls Below 24,450 as Fed’s Decision Triggers Market Volatility

 

On December 17, the Indian stock markets sharply fell back. Sensex tumbled over 800 points, and Nifty came down below 24,450. Investor caution ahead of the U.S. Federal Reserve's key policy meeting in mid-December saw this kind of sell-off. Heavy falls were witnessed in most major sectors, particularly in banking and oil stocks

.

Market Overview: Sensex and Nifty Plunge Amid Fed Concerns

 

By 10:30 AM, Sensex was down 830 points or 1% at 80,918. Nifty followed the same pattern and was down 254 points at 24,414. HDFC Bank, Reliance Industries, and ICICI Bank were among the heavyweights that pulled the market further down.

 

Federal Reserve Meeting Focus: Expectations of Rate Cut

 

The markets are closely watching the Fed’s December 18 meeting, with an expected 25 basis point rate cut. A 97% probability of the rate cut, as per the CME FedWatch tool, has sparked caution among investors. They are now awaiting clarity on future rate decisions, which are critical for global financial stability.

The India VIX, a measure of market volatility, rose about 6% to 14.8, showing rising uncertainty. Global market conditions and year-end holidays have also been affecting investor strategies. Long-term investors find public sector banks and housing finance companies attractive if the Fed delivers on the expected rate cut.

 

Sector-wise Breakup: Financials and Oil Stocks Drag

 

On the flip side, the financial services sector, including HDFC Bank, ICICI Bank, and Shriram Finance, took a huge hit, falling between 0.5-2.5%. Oil majors like RIL, ONGC, and BPCL also dragged the markets down, reflecting the overall negative sentiment.

 

Media Sector Out Performs Well: Select Stocks

 

In a broader market slump, the media sector bucked the trend. PVR Inox, Zee Entertainment, and Nazara Technologies shares rose by more than 1% on strong performance and investor optimism.

 

Technical Levels to Watch: Nifty Faces Resistance and Support

 

Looking at technical levels, Nifty faces strong resistance at 24,800 and 25,000. Breaching these levels points to further upside on the market. On the negative side, support lies at 24,550 and 24,400, and hence, traders are advised to remain cautious while managing risks.

 

Market Outlook: Fed's Decision to Shape Market Sentiment

 

The market remains focused on the Fed's interest rate decision and how it will affect global and domestic economies in the coming months.