Indian shares set to open higher ahead of Fed policy

Bengaluru, 31 January (Reuters): Indian shares are likely to open higher on Wednesday, bucking weakness in broader Asian equities ahead of the U.S. Federal Reserve's policy decision and commentary due later in the day.

India's GIFT Nifty was trading at 21,615 points as of 8:12 a.m. IST, suggesting the NSE Nifty 50 will open above its Tuesday close of 21,522.10.

The Nifty 50 and the BSE Sensex fell on Tuesday, dragged by financials and profit booking in index heavyweights.

Asian shares fell broadly on Wednesday, dragged by weak economic data from China while Wall Street equities were mixed overnight after strong U.S. labour data added to doubts over early interest rate cuts.

The Fed is expected to keep interest rates unchanged, while the Indian government is due to announce its interim budget on Thursday.

The Nifty volatility index jumped to a 10-month high of 16.10 on Tuesday.

Foreign institutional investors net sold shares worth about ₹1,971 crore ($237.1 million) on Tuesday, exchange data showed.

Domestic institutional investors remained net buyers, adding shares worth ₹1,003 crore.

Stocks To Watch

Tata Consultancy Services: Company announced a 15-year expansion of its partnership with UK's leading insurer Aviva.

Mahindra and Mahindra Financial Services: Company posted a drop in consolidated net profit in December quarter.

Larsen and Toubro: Company missed December quarter profit view and flagged rising logistics costs.

Dr Reddy's Laboratories: Company beat Q3 profit view, helped by strong performance in its generic drugs business in U.S. and European markets.

Key results on Wednesday: Maruti Suzuki India, Sun Pharmaceutical Industries.