Before Market Opens: 9 things to know at 9 am on May 4, 2023

U.S. stocks ended lower on Wednesday, reversing gains after comments by Federal Reserve Chair Jerome Powell left investors wondering what the U.S. central bank's next move would be with interest rate hikes.Indexes initially held onto gains following the Fed's statement. It increased interest rates by a quarter of a percentage point, as expected, and signaled it could pause further hikes. The Dow Jones Industrial Average fell 270.29 points, or 0.8%, to 33,414.24, the S&P 500 lost 28.83 points, or 0.70%, to 4,090.75 and the Nasdaq Composite dropped 55.18 points, or 0.46%, to 12,025.33.

Asia-Pacific markets declined after the US Federal Reserve hiked rates by 25 basis points as widely expected, bringing the federal funds rate range to 5 percent-5.25 percent — its highest level since August 2007.In Australia, the S&P/ASX 200 fell 0.63 percent, ahead of the country’s March trade data. South Korea’s Kospi opened 0.49 percent down, while the Kosdaq lost 0.24 percent. Futures for Hong Kong’s Hang Seng index were also lower standing at 19,656, compared to its last close of 19,699.16. Mainland Chinese markets are set to reopen after the Labor Day holiday, while Japanese markets are closed for a holiday Thursday.

The US Federal Reserve increased interest rates by a quarter of a percentage point, as expected, and signaled it could pause further hikes. The unanimous decision lifted the U.S. central bank's benchmark overnight interest rate to the 5.00%-5.25% range, the 10th consecutive increase since March 2022. Powell said the Fed still views inflation as too high, and said it was too soon to say the rate hike cycle is over.

At 8:20 am, the SGX Nifty was trading 60 points or 0.33 percent lower at 18,100, indicating a weak opening for the Indian markets. 

Benchmark indices ended lower on Wednesday, halting their eight days of rally, ahead of the US Federal Reserve's interest rate decision and mixed global market trends. Also, fall in index majors Reliance Industries, Tata Consultancy Services, Infosys and Larsen & Toubro added to the weak trend in equities. The 30-share BSE Sensex declined 161.41 points or 0.26 percent to settle at 61,193.30. The broader NSE Nifty fell 57.80 points or 0.32 percent to end at 18,089.85.

Oil prices fell 4 percent on Wednesday, extending steep losses from the previous session after the US Federal Reserve raised interest rates and as investors fretted about the economy. Brent futures settled $2.99 lower, or 4 percent, to $72.33 a barrel, the global benchmark’s lowest close since December 2021. Brent hit a session low of $71.70 a barrel, its lowest since March 20. West Texas Intermediate crude (WTI) fell $3.06, or 4.3 percent, to $68.60. WTI’s session low was $67.95 a barrel, lowest since March 24.

Foreign institutional investors (FII) bought shares worth ₹1,338 crore, whereas domestic institutional investors (DII) sold shares worth ₹583.99 crore on May 3, provisional data from the National Stock Exchange showed.

The rupee consolidated in a narrow range and settled for the day higher by 6 paise at 81.81 (provisional) against the US dollar on Wednesday, tracking the weakness of the American currency in the overseas market.

Gold firmed up on Wednesday as the US Federal Reserve delivered a widely expected rate hike and signalled a pause in further increases. Spot gold was last 1.13 percent higher at $2,039.0168 per ounce after touching its highest since April 14 at $2,036.15 earlier.