Central Bank’s shocker...

Analysts said more than the rate hikes, the comments by Federal Reserve Chairman Jerome Powell would be keenly tracked to see whether any surprise announcements could raise concerns about a slowdown in the US economy. Further, analysts said markets had priced a 50-basis point cut, but a bigger cut could send them into a tailspin.

“Markets are hoping that it is not going to be too aggressive. We know there is still more to come after this hike,” said Holland.

On Tuesday, European Central Bank Executive Board Member Isabel Schnabel said a rate hike could come as early as July. Schnabel said it was high time policymakers took steps to contain inflation. The European Union’s plan to ban Russian crude oil over the next six months and refined fuels by the end of the year added to investor concerns.

The war in Ukraine and the US and its allies’ efforts to isolate Russia have led to a spike in commodity prices.

Ajit Mishra, VP of research, Religare Broking, said domestic factors like earnings and macroeconomic data would further add to the choppiness in the coming days.

“The real test would be to handle the volatility post the US Fed meeting. It’s prudent to limit positions and continue with a stock-specific trading approach,” he said.

The broader markets were weak, with 2,645 stocks declining and 734 stocks advancing on the BSE. Barring three, all Sensex stocks fell.

Reliance Industries fell 3.14 per cent, while HDFC Bank and ICICI Bank fell 3.34 per cent and 2.3 per cent, respectively. Consumer Durables stocks fell the most and its sectoral index fell 3.8 per cent on the BSE.