Indian Stock Market: 7 Key Things That Changed Overnight For The Market – Gift Nifty, US Producer Price Index to Oil Prices

Indian Stock Market: Domestic equity market indices Sensex and Nifty 50 are expected to open higher on Wednesday on the back of positive momentum in global markets.

Asian markets were higher, while the US stock market rallied overnight after weak economic data fuelled speculation that the US Federal Reserve would cut interest rates in September.

According to CMEs FedWatch tool, traders now believe the probability of a 50 basis point rate cut by the US Federal Reserve is 55 percent, up from less than 50 percent previously.

Indian stock market indices closed sharply lower on Tuesday due to foreign capital outflows and mixed trends in global markets.

The Sensex fell 692.89 points or 0.87% to close at 78,956.03, while the Nifty 50 was 208.00 points or 0.85% lower at 24,139.00.

“Domestic equities succumbed to global headwinds due to geopolitical uncertainty and caution over US inflation data. Healthy domestic macro data failed to provide the much-needed support. We expect the market to continue in its consolidation mode in the absence of major positive triggers. However, investors should use this decline as a buying opportunity for quality stocks, especially large-cap stocks whose valuations are still comfortable,” said Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services Ltd.

Here are the key global market signals for Sensex today:

Asian markets

After an overnight rally on Wall Street, Asian markets posted higher prices on Wednesday.

Japan’s Nikkei 225 gained 0.98 percent, while the Topix rose 0.72 percent. South Korea’s Kospi climbed 1.1 percent, while the Kosdaq gained 1.4 percent. Hong Kong’s Hang Seng Index pointed to a higher opening.

Give Nifty as a gift today

Gift Nifty was trading at around 24,235, up nearly 75 points from the previous close of Nifty futures, indicating a positive start for Indian stock market indices.

WallStreet

The U.S. stock market closed higher on Tuesday, hitting a near two-week high, as weaker producer price data increased speculation about a Fed rate cut.

The Dow Jones Industrial Average rose 408.63 points, or 1.04%, to 39,765.64, while the S&P 500 gained 90.04 points, or 1.68%, to close at 5,434.43. The Nasdaq Composite closed 407.00 points, or 2.43%, higher at 17,187.61.

Nvidia shares rose 6.5%, Intel shares jumped 5.7%, Tesla shares jumped 5.24%, and Advanced Micro Devices shares gained 3.2%.

Starbucks shares rose 24.5% and Chipotle shares fell 7.5%. Home Depot shares gained 1.2% and BuzzFeed shares climbed 25.9%.

US producer prices

US producer prices rose less than expected in July. The producer price index for final demand rose 0.1 percent last month after rising an unchanged 0.2 percent in June. In the 12 months to July, the producer price index rose 2.2 percent after rising 2.7 percent in June. Economists polled by Reuters had forecast a 0.2 percent rise in the producer price index.

Oil prices

Crude oil prices rose on estimates of shrinking U.S. crude and gasoline inventories.

Brent crude futures rose 0.50% to $81.09 a barrel, while U.S. West Texas Intermediate crude futures rose 0.63% to $78.84 a barrel.

Yields on US Treasury bonds

US Treasury yields fell amid speculation about monetary easing. The 10-year US Treasury yield fell to 3.8484%, while the 2-year US Treasury yield fell to 3.9398%.

dollar

The dollar remained in retreat after falling against major currencies overnight. The dollar index – which measures the currency against six major rivals including pound sterling, euro and yen – was steady at 102.63 after falling 0.49% overnight, Reuters reported. The pound was steady at $1.2866 and the euro was unchanged at $1.0996. The dollar was steady at 147.06 yen.

(With contributions from Reuters)

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