Market may open in red owing to Fed rate hike fears

Indian equities market extended their gains for the second straight day on Tuesday tracking positive global cues. Market sentiments also remained upbeat following exit polls. At the end of polling in Assam, exit poll results showed BJP winning the elections for the first time, raising hopes about its reform agenda.  The Sensex ended up 120.38 points or 0.5% at 25773.61, and the Nifty closed up 30 points or 0.4% at 7890.75. The broader markets underperformed the benchmark indices. The BSE Mid-cap index closed 0.13% higher; while the Small-cap index advanced 0.19%.

U.S. stocks closed lower Tuesday after Federal Reserve officials implied that interest rates could be raised as early as June. The Dow Jones Industrial Average fell 180.73 points, or 1%, to 17529.98. The S&P 500 dropped 19.45 points, or 0.9%, to 2047.21. The Nasdaq Composite lost 59.73 points, or 1.3%, to 4715.73. The Fed’s minutes from its April policy meeting are scheduled to be released Wednesday.

Oil prices hit highest level in 7 months after Goldman Sachs said the oil market is now in a supply shortfall. WTI crude posted its best settlement since October, closing at USD 48.31 a barrel, up 59 cents, or 1.2%, after hitting a seven-month high at USD 48.42. Brent crude rose 36 cents, or 0.7%, at USD 49.33, off the six-month high of USD 49.58.

European stocks ended a choppy session almost flat. The Stoxx Europe 600 ended down 0.01 points at 334.72. U.K’s FTSE 100 gained 0.3% to 6,167.77, Germany’s DAX 30 fell 0.6% to 9,890.19. France’s CAC 40 dropped 0.3% to 4,297.57.

Asian markets opened lower Wednesday. Japan’s Nikkei 225 index has risen 0.76%, after earlier falling as much as 0.6%. The rise is due to the country's economic growth beating expectations. South Korea's Kospi index shed 0.6%. Australia's ASX 200 was down 0.1%; and New Zealand’s S&P/NZX 50 Index traded lower by 0.24%.

On the domestic front, A SGX Nifty 50 index future for May series is trading down by 31.50 points at 7,877. Indian markets are likely to open in red due to Fed rate hike fears. Investors will be keeping an eye on Balkrishna Industries Ltd., Dalmia Bharat, JK Lakshmi Cement and Torrent Power, results for which are due for release today.