Opening Bell: Nifty, Sensex open flat; midcap, small cap stocks see buying interest

Snapping a three-day losing streak, the Indian market opened on a flat note ahead of the Fed meeting outcome announcements on Wednesday. The broader Nifty50 opened near 15700 while the Sensex started near 52,650.  

Outperforming benchmarks, Nifty midcap and smallcap gained 0.7% and 0.9% respectively in the broader market.  

On the sectoral front, maximum buying interest was seen in media, auto and realty stocks even as almost all sectoral indices started the day in the green. Nify FMCG was the only index trading on the other side.  

"More than the quantum of the rate hike (50 or 75 bp) it would be the message from the Fed in today's policy announcement that would determine the market direction. The market is prepared for a 75bp rate hike and, therefore, that decision, if it comes, is unlikely to rattle markets," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

In India, relentless FPI selling is the major negative, he highlighted. With dollar index above 105 and US 10-year bond yield at 3.46 %, FPIs are likely to continue selling, pulling the market down from every rally, he said.

"A sustained upward move in the market is possible only when the FPIs substantially reduce selling. The only sensible investment strategy in this scenario is to slowly accumulate high quality stocks whose prices are depressed not because of poor fundamentals, but sustained FPI selling," the expert added.

Minutes before the market opening, the Sensex declined by 130 points as 21 shares advanced, eight declined and one remained neutral on the 30-share index. 

Earlier, SGX Nifty Futures, which hints at opening trends for the domestic market, was trading flat with marginal loss of 10 points on the Singaporean Exchange in early trade on Wednesday. 

Besides, Japanese Nikkei 225 dropped 0.7%, while Chinese Shanghai Composite and Hang Seng index at the Hong Kong Exchange gained more than one per cent each in the early trade around 8.30 am on Wednesday.  

Earlier, the US markets saw a mixed closing too on Tuesday. The US benchmarks Dow Jones closed with a half per cent cut, Nasdaq gained around 0.2% and S&P 500 dropped around 04%.