India stock benchmarks set to open lower with Bihar election results in focus
India's equity benchmarks were set to open lower on Friday as investors awaited election results from the northern state of Bihar to gauge the ruling alliance's popularity, while fading hopes of a near-term U.S. rate cut dampened sentiment.
Gift Nifty futures were trading at 25,845.5 points, as of 7:37 a.m. IST, indicating that the Nifty 50 would open below Thursday's close of 25,879.15.
Both the Nifty and the Sensex closed flat on Thursday, after rallying 1.5% in the previous three sessions.
"Friday's session may see heightened volatility due to the Bihar election outcome," said Siddhartha Khemka, head of research of wealth management at Motilal Oswal Financial Services.
Exit polls showed the ruling National Democratic Alliance was on track to retain power in Bihar, but any surprise loss could trigger a 5%-7% correction in the stock markets since it would impact policy continuity and political stability, according to analysts.
Counting of votes will begin at 8 a.m. IST.
Other Asian stock markets declined, tracking an overnight drop on Wall Street as hawkish comments from Federal Reserve officials doused hopes for a rate cut in December. [MKTS/GLOB]
Foreign portfolio investors (FPIs) offloaded Indian equities for the fourth straight session on Thursday, with net outflows of 3.84 billion rupees.
Domestic institutional investors (DIIs) remained buyers for the 15th straight session, purchasing stocks worth 51.27 billion rupees on Thursday.
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