India’s benchmark indices, the Sensex and Nifty, recorded their sharpest weekly declines since June 2022, with both falling over 5%. The selloff was fueled by global market volatility and the US Federal Reserve’s cautious stance on rate cuts.
On December 20, the Sensex closed near the 78,000 mark, shedding 1.5% from the previous session, while the Nifty fell below 23,600, also down 1.5%. The decline reflects concerns about the Fed’s decision to revise its 2025 rate cut projections from four to two, unsettling global markets.
Global markets mirrored the trend, with the Stoxx 600 in Europe slipping 1% for its worst week in three months. Asian equities experienced their longest losing streak since April, while US indices such as the S&P 500 and Nasdaq 100 futures fell 0.8% and 1.2%, respectively.
Market participants now await the upcoming US personal consumption expenditures (PCE) data, a critical inflation measure closely monitored by the Fed. Adding to the uncertainty, fears of a US government shutdown loom as the House rejected a temporary funding plan, with a deadline fast approaching.
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