U.S. Stocks Finish Choppy Trading Day Little Changed, All eyes are on the RBI's MPC decision.

Wall Street's major indices closed nearly flat on Thursday as a surprisingly strong labour market report raised doubts about the pace of future Fed rate cuts. The dollar and Treasury yields rose on the data.

Amazon.com's 1.4% decline weighed on the S&P 500, limiting gains despite investor optimism ahead of next week's expected Fed rate cut.

Initial jobless claims dropped to 191,000—the lowest since September 2022—contrasting sharply with this week's weak ADP private payrolls report.

WTI crude is headed toward a 2% weekly gain on Friday, supported by anticipated Fed rate cuts, U.S.-Venezuela tensions, and stalled Moscow peace talks.

Trading remained subdued as markets awaited fresh inflation data and the December 10 FOMC decision, where a 25-basis-point cut is widely expected.

Speculation that Kevin Hassett may replace Jerome Powell as Fed chair is driving expectations of lower long-term rates. The White House economic advisor is viewed as potentially ushering in a more dovish Fed policy, aligned with President Trump's push for aggressive rate cuts.

The Indian Rupee reversed its six-day losing streak, appreciating by 22 paise against the US Dollar to close at 89.97. This pullback is attributed mainly to suspected central bank intervention and to the unwinding of speculative long-dollar positions.

RBI Governor Sanjay Malhotra will announce the MPC decision at 10 AM today, with the economists divided over the likely outcome. Some are expecting a 25 basis points cut while many believe hopes of a rate cut have faded due to strong GDP growth. We believe there is room for a 25-basis-point cut, pre-empting the FOMC rate cut on 10th December.

Nifty snapped its four-session losing streak, gaining 47 points to close at 26,033 yesterday. On the Sensex weekly derivative expiry day, bulls managed to hold a slight edge.

On the downside, the recent swing low at 25,842 remains a crucial support level, while the 26,150–26,200 zone is expected to act as strong resistance.

RBI's decision will drive the markets in the short run, primarily financial stocks.