Sensex, Nifty cautious ahead of US Fed policy meet today

The market is worried about US-India trade differences, slow monsoon and other issues

Stock market rep (File) People watch a television screen at the Bombay Stock Exchange (BSE) building in Mumbai | AP

Domestic equity benchmark BSE Sensex and the NSE Nifty turned cautious in early trade on Tuesday ahead of the US Federal Reserve's meeting on Tuesday, amid escalating global trade war concerns.

After rebounding over 150 points in the opening session, the 30-share index pared gains to trade marginally higher at 38,969.76 at 9:45am. Similarly, the broader NSE Nifty was quoting slightly up at 11,678.25.

In the previous session on Monday, the BSE gauge settled 491.28 points, or 1.25 per cent, lower at 38,960.79; the Nifty cracked 151.15 points, or 1.28 per cent, to close at 11,672.15.

Top losers in the Sensex pack in early trade included Yes Bank, Tata Steel, Asian Paints, HUL, SBI and RIL, shedding up to 1.55 per cent.

On the other hand, PowerGrid, Infosys, IndusInd Bank, HCL Tech, Vedanta, M&M, Bajaj Finance and HDFC rose up to 1.42 per cent.

Investors have turned cautious ahead of the US Federal Reserve's policy meeting, scheduled to begin later on Tuesday, traders said. According to experts, the market is finding it difficult to sustain at elevated levels on the back of muted corporate earnings, slow monsoon season, continuous corporate defaults and developing concerns of India-US trade disagreements.

Further adding to worries are concerns around an escalation of the trade war between the US and China, and impact for India, as well as US data that showed that the economy may not need a rate cut imminently, they said.

Elsewhere in Asia, while the Shanghai Composite Index, Hang Seng and Kospi were trading on a positive note in their respective early sessions, the Nikkei was trading in the red.

Meanwhile, foreign institutional investors sold equity worth Rs 331.27 crore, while domestic institutional investors bought shares to the tune of Rs 1,257.86 crore, provisional data available with stock exchanges showed on Monday.

On the currency front, the Indian rupee appreciated 9 paise to 69.82 against the US dollar.

The global oil benchmark Brent Crude futures were trading 0.10 per cent lower at $60.88 per barrel.