FX.co ★ Sensex, Nifty Set For Soft Open As Investors Await Fed Decision

Indian shares are poised for a slight dip at the opening on Tuesday as investors digest the implications of rising oil prices and await key insights from several central bank meetings scheduled for this week.

On Monday, benchmark indices Sensex and Nifty registered minor gains amidst cautious trading, while the rupee appreciated by 4 paise, closing at 83.88 against the dollar.

Asian markets exhibited a mixed performance in thin trading conditions this morning, primarily due to the closure of markets in mainland China and South Korea for public holidays.

Later today, the U.S. Federal Reserve will commence a pivotal two-day policy meeting, with increasing speculation of a significant rate cut. Current market sentiment, as indicated by the CME FedWatch Tool, suggests a 62 percent likelihood of a 50 basis-point cut and a 38 percent likelihood of a 25 basis-point cut.

The forthcoming U.S. retail sales data for August, expected later in the day, may further influence the Fed's interest rate decision.

In the Asian trading session, the dollar remained subdued due to the anticipation of rate cuts, while gold saw marginal gains. Meanwhile, oil prices continued to rise following overnight gains, driven by concerns regarding Hurricane Francine's potential impact on output in the U.S. Gulf of Mexico.

U.S. equities closed mixed on Monday; tech stocks underperformed and the dollar weakened ahead of the anticipated central bank meetings later this week. Notably, a survey revealed that manufacturing activity in the New York region expanded for the first time in nearly a year.

The Dow Jones Industrial Average climbed 0.6 percent to a record high close, the S&P 500 edged up by 0.1 percent, while the Nasdaq Composite, dominated by technology stocks, declined by 0.5 percent.

In Europe, stocks mostly ended lower on Monday, halting a three-day winning streak amid escalating concerns over China's economic slowdown. The pan-European STOXX 600 dipped 0.2 percent, the German DAX decreased by 0.4 percent, France's CAC 40 fell by 0.2 percent, and the U.K.'s FTSE 100 closed flat, albeit with a positive tilt.