Indian shares pull back after six-session rise as investors await US data

Nov 18 (Reuters) – India’s equity benchmarks inched lower in early trade on Tuesday, following six consecutive sessions of gains, as investors awaited key U.S. economic data releases that would offer cues on whether the Federal Reserve cuts rates next month.

The Nifty 50 was down 0.2% at 25,962.65, while the BSE Sensex lost 0.18% to 84,799.90 as of 9:29 a.m. IST.

Twelve of the 16 major sectors traded lower, although losses were marginal. The broader small-caps and mid-caps fell 0.5% and 0.2%, respectively.

The benchmarks climbed about 2% over the last six sessions, supported by an earnings season that had no major disappointments, strong domestic inflows, and the end of the U.S. government shutdown. The indexes are now about 1.3% below their record highs hit in September 2024.

The broader market undertone stays constructive, buoyed by political stability, cooling inflation, soft crude oil prices, and trade-deal optimism, while lacklustre global sentiment is a mild drag, said Prashanth Tapse, senior vice president of research at Mehta Equities.

Among stocks, Max Healthcare jumped nearly 2% and was the biggest gainer on Nifty 50 as analysts were bullish on the company’s growth prospects driven by capacity expansion plans.

Wall Street equities closed lower overnight, while Asian markets fell 1.6% on fading hopes of a U.S. rate cut in December ahead of key data releases in the U.S., including the September jobs reading.

This week’s lineup of U.S. data, which includes the delayed September jobs report, will be closely watched following the end of the shutdown last week.

The odds of a 25-basis-point rate cut by the Fed on December 10 have dropped to 42.9% from 62.4% last week, according to CME FedWatch.

Higher U.S. rates make investments in emerging markets such as India less attractive for overseas investors.