Global Macro Signals on Morning of 22 Sept 2025
- Fed’s caution clouds hopes for aggressive easing: Markets remain skeptical that the U.S. central bank will accelerate rate cuts, with stronger economic data keeping a hawkish undertone alive. Investors are watching closely for Powell’s next remarks.
- Asian equities tread cautiously after U.S. volatility: Gains in U.S. markets faded late in the session, and Asian peers opened mixed. The fragile sentiment underscores the lack of conviction across regional bourses.
- GIFT Nifty points to a soft open for Indian equities: Futures are trading lower, suggesting a subdued start unless overseas flows provide support. Market participants remain hesitant ahead of domestic cues.
- U.S. futures slip after intra day retracement: The weakness in S&P and Nasdaq futures indicates that traders are digesting recent swings. The lack of momentum signals possible consolidation.
- 10 year U.S. yield holds near 4.1 percent mark: Bond yields remain elevated, limiting the scope for carry trades and weighing on rate sensitive sectors. This continues to be a key pressure point for equities.
- Dollar ticks up on safe haven demand: A firmer dollar index is dampening flows into emerging markets. Investors remain defensive as global risk appetite stays fragile.
- Gold remains elevated on global risk aversion: Bullion prices are holding near record levels as geopolitical tensions and policy uncertainty sustain safe haven demand.
- Brent crude steady on supply disruption fears: Kurdistan export slowdowns and OPEC signals are keeping crude prices supported. Demand side weakness has so far not offset the supply concerns.
- Visa shock clouds India’s IT export narrative: The steep hike in H 1B visa fees has rattled confidence in the IT sector. This raises questions over medium term earnings resilience for technology exporters.
- FIIs net sellers while DIIs step in: On 22 Sept, foreign institutional investors sold equities worth around Rs2,910 crore while domestic institutions purchased about Rs2,583 crore, providing a partial cushion to flows.
> Market Outlook and Trade Setup
The global landscape continues to shift between optimism on easing and fears of policy tightening. This makes the near term tone choppy rather than directional. For Indian equities, the implication is a higher probability of range bound trade with sector specific moves dominating. Overseas volatility is being transmitted into domestic indices, limiting follow through momentum. Technically, Nifty is hovering close to key resistance zones and requires sustained strength above those levels to validate any upside breakout. On the downside, support around the 50 day moving average and lower channel bands needs to hold to prevent structural weakness.
Options positioning shows higher implied volatility, reflecting the market’s expectation of sharp intraday swings without clear directional conviction. Flows remain the balancing factor. With FIIs continuing to reduce exposure, the burden of stabilization shifts to domestic institutions. While DIIs have stepped in, their net buying may only cushion and not reverse the trend unless foreign selling abates. Overnight F&O contract build up will also matter, as aggressive long positioning could limit downside, but thin participation leaves the market vulnerable.
Implied cues for open and direction: Expect a soft to neutral open with upside capped unless strong global catalysts emerge. The session is likely to be range bound, with downside tests possible if support levels are breached. Sustained upside would require decisive breakouts above resistance supported by foreign inflows. In conclusion, Indian equities are trading under heavy crosswinds. Without a clear reversal in foreign flows or a supportive global impulse, today’s session could see more consolidation and defensive positioning. Market sentiment remains cautious, liquidity support from DIIs offers stability, and contract flow cues will guide intraday tone. Overall, the bias leans toward consolidation with a soft opening and range limited moves.