The key domestic benchmarks may open on a flat note tracking a mixed trend in Asian markets after the US Federal Reserve raised its estimates for interest rates at the end of next year while tapering QE by USD 10 billion. The Fed which re-affirmed its commitment to keep interest rates low for a considerable time, raised its median estimate for the federal funds rate by 25 basis points at the end of 2015 to 1.375 per cent, up from 1.125 per cent in June. The Fed is tipped to wrap up QE by October. The rise in interest rates estimates suggested a somewhat hawkish stance by the Fed and may lead to volatility in equities and affect capital flows into emerging markets. China’s Shanghai Composite was trading flat, with a positive bias while Hang Seng tumbled after China’s new home prices fell in 68 out of the 70 cities tracked by the government in August. However, Japan’s Nikkei 225 surged as a weaker yen boosted the appeal of exporter stocks. Back home, investors will be eying India-China talks today as Indian Prime Minister Narendra Modi will host his Chinese counterpart Xi Jinping for talks in New Delhi after the two countries inked more than USD 3.4 billion in agreements on Wednesday.
