US Fed rate cut, Dec. 10 -- A rate cut by the US Federal Reserve is traditionally seen as a positive for emerging markets like India, because lower US interest rates are expected to reduce the attractiveness of US debt and push global investors toward higher-yielding, riskier assets such as EM equities and bonds.

While the theory remains in place, the history suggests otherwise. The last five instances of US Fed rate cuts alone show that Nifty 50 has declined in three sessions the immediate next day, and lost in four of five instances within a week, with an average loss of 1.07%.

Now, the Federal Reserve is again anticipated to announce a rate cut today, December 10, following the conclusion of its two-day meeting, with traders now seei...