India stock benchmarks set to open higher after 3-session drop

India’s equity benchmarks are poised to open higher on Wednesday, ending a three-session losing streak driven by profit-booking at record highs, while focus shifts to the Reserve Bank of India’s rate decision and commentary on Friday.

GIFT Nifty futures were trading at 26,196 as of 07:52 a.m. IST, indicating that the Nifty 50 will open above Tuesday’s close of 26,032.2.

Both the Nifty and Sensex have lost about 0.7% each in last three sessions after scaling record peaks after 14 months last week, boosted by improving earnings, stable growth and supportive fiscal and monetary policies.

Domestic investors remained buyers at record levels, but foreign investors offloaded Indian shares for four consecutive sessions, with outflows worth 36.42 billion rupees ($405.3 million) on Tuesday, pressuring the rupee, which weakened to a record low of 90 per U.S. dollar.

Investors are awaiting the RBI’s policy decision on Friday, amid expectations that robust economic growth might prompt the central bank to keep interest rates steady.

“A rate cut, if delivered, could unlock an incremental 2%-3% upside for Indian equities,” said Ponmudi R, chief executive of Enrich Money.

Other Asian markets opened higher on the day, tracking an overnight rebound on Wall Street as a brief selloff in global bond markets abated.

Asian markets were subdued in the last two sessions as expectations of a looming rate hike in Japan triggered a global bond selloff, leaving stocks caught in the rush from risk assets.

Among individual stocks, Meesho will be in focus ahead of its initial public offering (IPO), which begins on the day.

The SoftBank-backed e-commerce firm is seeking a valuation of up to $5.6 billion through its IPO.