Foreign investors stepped up selling from Wednesday, while domestic institutions remained net buyers. The Nifty crossed 23,000 intraday, led by heavyweight stocks and IT shares.

The Indian rupee opened at 94.92 against the US dollar, up 23 paise from the previous session's close of 95.15. The currency drew support as US Treasury yields pulled back after September inflation data came in stronger than expected, cooling expectations for a Federal Reserve rate hike in October. The Reserve Bank of India has introduced a 20% Foreign Exchange Risk Reserve requirement on specified rupee derivative contracts exceeding $2 million.

Chicago Fed President Austan Goolsbee warned that the artificial intelligence investment boom could overheat aggregate demand and keep inflation elevated. After three rate cuts in 2025, the Fed raised rates by 25 basis points last month to a range of 3.75%-4.00% as inflation proved stubborn. Markets expect the central bank to hold steady at its October meeting but to raise rates again in December.

Lower production forecasts in major growing regions, including India, Brazil and Thailand, are adding to supply concerns. Rising crude oil prices are also boosting biofuel demand, lifting vegetable oil prices and adding to inflationary pressures worldwide.

Companies are investing billions of dollars in artificial intelligence (AI), but the money they spend is only one part of the story. How much revenue is AI generating, and how is it changing the way businesses earn money? This week, figures from TCS, OpenAI and chipmaker TSMC offered a glimpse into the commercial side of the AI boom.

Xiaomi said its newly launched SkyNomad SUV series logged more than 70,000 nonrefundable orders in its first month on the market, helping lift its Hong Kong-listed shares as much as 9.2%. The tally trails the 240,000 nonrefundable orders the YU7 SUV drew within the first 18 hours of its release last year. The company said it delivered more than 40,000 vehicles in September, including 10,000 Skynomad SUVs.

The Reserve Bank of India raised its repo rate by 25 basis points to 5.5% and shifted its policy stance to “calibrated tightening,” aligning with a broader global tightening cycle. The central bank expects headline CPI inflation to average 5.8% over the next three quarters, while core CPI is projected at 4.4% for financial year 2027. Despite global economic uncertainty, it lifted its financial year 2027 GDP growth forecast to 7.1% from 6.7% and adjusted its quarterly projections.

Nifty 500 constituents opened mixed, with PTC Industries rising more than 4% and hitting a record high after launching a QIP to raise up to ₹1,800 crore. Titan Company fell even after releasing a strong second-quarter business update. Chennai Petroleum gained as much as 4.5% and was up more than 73% since the beginning of the year, while Prime Focus dropped more than 5%.

India’s Nifty index rose for a second straight session on Tuesday, adding 220 points to close at 22,776.10, as investors stayed optimistic ahead of the Reserve Bank of India’s monetary policy decision scheduled for Wednesday. In the U.S., the Dow Jones ended up 250 points and the S&P 500 crossed 7,800 for the first time. Brent crude moved back above $101, and Nifty futures pointed to a lower open.