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NEW DELHI: The 50-share Nifty index is expected to open soft on Wednesday tracking Asian markets which were trading mixed as investors across the globe eye outcome of two-day US Federal Reserve meet.
At 07:30 a.m., Nifty India stock futures in Singapore were trading 9 points higher at 5803, indicating a soft opening on the domestic market.
Indian markets are now looking for any cues from US Federal Reserve Chief Ben Bernanke on monetary easing that would decide further course of market movements.
Markets might react negatively on news of tapering off of monetary easing because that was one of the major reasons of strong rally in emerging markets, including India.
"Definitely, Ben's statement and his language which he uses will be a key event for short-term market movement as well as volatility," said Gautam Chhaocharia, Head of India Small/Mid-cap Research, UBS in an interview with ET Now.
"Global markets are likely to remain volatile and especially India which has already seen sharp sell-off in equities as well as in bond markets," he added.
Nifty ended the day with a loss of 36 points at 5813 on Tuesday. "The index is now trading at support level of 5800 mark and resistance placed at 5900/5950," said Swati A. Hotkar, Technical Analyst at LKP Advisory.
"Any move below 5800 levels may drag the Nifty towards 5750 levels. As long as it trades above 5800 mark we would trade with positive bias," she added.
Overnight, US stocks ended higher as investors bet that Federal Reserve would not taper its bond buying programme sooner than expected.
"Traders are trying to guess Federal Reserve's timeline for scaling back purchases of $85 billion per month of bonds in its two-day policy meet which started on Tuesday," Reuters reported.
The policy, known as quantitative easing, has helped fuel stocks' rally, taking major indexes to record levels in US markets as well as in most of the emerging markets.
The Dow Jones industrial average was up 138.38 points, or 0.91 per cent, at 15,318.23. The Standard & Poor's 500 Index was up 12.77 points, or 0.78 per cent, at 1,651.81. The Nasdaq Composite Index was up 30.05 points, or 0.87 per cent, at 3,482.18.
Asian markets were trading mixed ahead of the outcome of two-day US Federal Reserve policy meet.
Nikkei surged over 2 per cent after Japan's exports surged 10.1 per cent in May, compared with a 3.8 per cent rise the previous month in a sign that a weak yen is starting to boost exporters.
"Major currencies were subdued as well ahead of the outcome of the Fed's policy meeting due at 1800 GMT and Chairman Ben Bernanke's media briefing half an hour later.
U.S. crude was trading flat at $98.43 per barrel.
Japan's Nikkei 225 index was trading 2.1 per cent higher at 13,280.17 and Hong Kong's Hang Seng index was trading 0.5 per cent lower at 21,117.12.
South Korea's Kospi index was trading 0.4 per cent lower at 1892.45. China's Shanghai index was trading 1.06 per cent lower at 2,136.63.
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