Sensex turns lower on Fed's taper decision - NDTV

India's stock markets opened higher despite the announcement of Fed taper overnight but could not hold on to its initial gains.

The US Federal Reserve last night said it would reduce its monthly asset purchases by $10 billion to $75 billion, but it also indicated that its key interest rate would stay at rock bottom even longer than previously promised. Other global markets have reacted positively to Fed's dovish guidance.

The Sensex had surged over 150 points today at its day's high of 21,017 but profit-taking emerged at higher levels. At 9.52 am, the Sensex was down 207 points at 20,652 while Nifty was off 64 points to 6,152. The rupee was lower at 62.37 per dollar vs yesterday's close of 62.09.

Explaining today's volatility, Phani Shekhar of Angel Broking said fund managers took advantage of today's initial rally to book profits ahead year-end.

Savendra Srivastava, a market analyst, said some volatility is expected after a big event like the announcement of Fed taper.

Analysts don't expect significant effect on Indian markets due to Fed taper.

Taimur Baig of Deutsche Bank said he does not expect liquidity tightening due to the taper and the robust US data to support financial markets. He expects the rupee remain in the low-sixties against the dollar.
 

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