Domestic shares may decline sharply, extending previous session's losses, after the Reserve Bank of India Governor, Urjit R. Patel, resigned from his post last evening citing personal reasons.

Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could fall 171.50 points at the opening bell.

Investors are also bracing for the state election results that will be out today, 11 December 2018. The outcomes of the assembly elections will likely set the tone for the general elections next year. Voting in Rajasthan and Telangana took place on 7 December 2018. Assembly elections in Madhya Pradesh and Mizoram were held on 28 November 2018. The election in Chhattisgarh Assembly was held in two phases on 12 and 20 November 2018. The counting of votes in all the states will begin at 8:00 IST today, 11 December 2018.

Exit polls on Friday reportedly indicated that the Bharatiya Janata Party risks losing control of Rajasthan to the Congress and faces a close fight in Madhya Pradesh and Chhattisgarh.

Overseas, Asian shares were mostly lower on the back of a volatile session on Wall Street which saw the Dow recover from a 507-point drop.

US stocks closed higher Monday as major indices bounced back from earlier losses as renewed confidence in the strength of the US economy offset lingering worries over the US-China trade dispute.

Investors are increasingly focusing on the December 18-19 Federal Reserve meeting, where the central bank is widely expected to raise interest rates. Comments from Fed Chairman Jerome Powell will be in the spotlight.

Meanwhile, British Prime Minister Theresa May confirmed a decision to postpone a vote on her plan for the UK to exit from the European Union.

Closer home, foreign portfolio investors (FPIs) bought shares worth a net Rs 116.22 crore on 10 December 2018, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 145.80 crore on 10 December 2018, as per provisional data.

Local equities dropped sharply yesterday, 10 December 2018, weighed by slide in index pivotals. The barometer index, the S&P BSE Sensex, lost 713.53 points or 2% to settle at 34,959.72. The Nifty 50 index lost 205.25 points or 1.92% to settle at 10,488.45.