Opening Bell - Morning Commentary
Wall Street Closes Lower as Tech Retreats Ahead of Fed Minutes
US major indexes closed lower on Monday, beginning the year's final week on a subdued note as heavyweight technology stocks retreated from last week's rally that had propelled the S&P 500 to record highs.
Big-name technology companies weighed on the markets, with Nvidia and Oracle posting notable declines. Following last week's strong performance, stocks drifted lower throughout Monday's session. All major averages declined, though selling pressure remained relatively muted.
The U.S. dollar held steady on Tuesday ahead of the Federal Reserve's release of its December meeting minutes, which are expected to reveal divisions within the central bank over next year's policy trajectory.
Investors await the minutes of the Federal Reserve's December policy meeting, scheduled for release on Wednesday afternoon. The central bank reduced its benchmark rate by 25 basis points to a target range of 4.25%–4.50% at that meeting. Market pricing suggests approximately an 80% probability that rates will remain unchanged at the upcoming January meeting.
Oil prices edged lower early Tuesday after climbing more than 2% in the previous session—partly pressured by spill-over from a pullback in precious metals—even as escalating Russia-Ukraine tensions kept supply-disruption fears elevated.
Precious metals retreated sharply on Monday, with silver and platinum pulling back from session highs, as investors locked in profits following recent rallies.
The Indian rupee extended its decline for a fifth consecutive session, weakening 12 paise against the dollar to close at 89.97. The move reflected a shift toward risk aversion, combined with typical month-end demand from importers and corporates amid thin market liquidity.
The Nifty's short-term trend weakened as it closed below its 20-day EMA at 25,993. However, the index continues to trade above its 50-day EMA support at 25,832 and maintains a higher-high, higher-low pattern on the daily chart, thereby preserving the broader uptrend.
A sustained break below 25726 would invalidate this bullish structure and could serve as a stop-loss reference for long positions. On the upside, the 26,100–26,150 zone is likely to act as near-term resistance.
Indian markets are likely to open muted on the monthly derivative expiry day amid a lack of strong global cues.