Morning Commentary: Wall Street Slides as Fed Hike Fears Return

MUMBAI, 24 SEPTEMBER: US equities fell sharply, snapping record runs, as the 10-year Treasury yield broke above 5%. The Nasdaq dropped 1.1% to 26,936, giving back its two prior record closes. The S&P 500 and Dow lost 0.8% and 0.7%. The Russell 2000 fell roughly 1%.

A strong S&P Global flash PMI drove the move. The composite index rose to 58.4 in September from 56.0 in August, the strongest private-sector expansion since July 2021. Services led (58.7 vs 56.5), and manufacturing jumped to 56.7 from 53.1 on stronger new orders, well above forecasts. The 10-year yield rose to about 5.06%, its highest since 2007, and the 2-year to about 4.87%, raising the odds of another Fed hike in October.

Brent recovered above $100 per barrel as hopes of a near-term reopening of the Strait of Hormuz faded.

Quantum computing stocks bucked the trend after IonQ announced a real-time error-correction advance ahead of the Quantum World Congress. The advance removes a key bottleneck for fault-tolerant computing.

United States and China agreed to extend the “Busan Agreement” trade truce until January 10, Treasury Secretary Scott Bessent announced after meeting Chinese Vice Premier He Lifeng. Investors are closely watching the high-profile US-China summit in Washington for trade and diplomatic signals that could sway risk sentiment across asset classes.

Additional focus turns to US jobless claims, building permits, and Fed speeches from Williams, Barkin, and Hammack for further direction on rate expectations.

Indian equities are poised for a lower open, on the back of weak global cues

Nifty continues to oscillate within the trading range of the large move on September 15, 2026. The 23,500–23,600 zone will continue to act as a key resistance band, while the 23,100–23,150 zone is expected to provide strong support. A sustained move above 23,600 would strengthen the bullish outlook, whereas a break below 23,100 could put renewed pressure on the index.

The Indian government reduced import duties on edible oils to help ease food inflation ahead of the festive season. Import duties on crude palm and soya oils were cut to 5% from 10%, while duties on refined variants were lowered to 27.5% from 32.5%.

The rupee snapped a four-day winning streak, depreciating 15 paise to close at 95.74, amid broad-based dollar strength and elevated dollar demand from importers. Markets are also beginning to price in a rate hike from the RBI.

Report by: Mr. Devarsh Vakil, Head of Prime Research at HDFC Securities

(Disclaimer: The information provided here is investment advice only. Investing in the markets is subject to risks and please consult your advisor before investing)

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