Indian stock market: After three sessions of losses, the local equities market is anticipated to begin flat to higher on Friday, supported by favourable trends in the international markets. Asian markets saw gains, while over night, the US stock market saw a surge driven by excitement about AI and rises in technology shares.
The Indian benchmark equity indices continued to lose ground on Thursday, extending their losses for a third straight day as they finished the erratic session down. Both the Sensex and the Nifty 50 have dropped almost 3% in three sessions.
The strong recent economic data in the US caused selling pressure as US bond yields rose, leading to further weakness in the domestic benchmark indices Nifty 50, which ended lower and prolonged their losses into the third consecutive session. This raised concerns about possible delays in interest rate cuts.
The Nifty 50 closed 109.70 points, or 0.51%, lower at 21,462.25, while the Sensex fell 313.90 points, or 0.44%, to conclude at 71,186.86. Investor attention will now turn to the corporate earnings for FY24's third quarter, which have been inconsistent thus far.
"In light of the uncertain global situation, we anticipate that the market will consolidate in a range with restricted upside. Today's Q3 earnings from Nifty heavyweights like Reliance Industries, Hindustan Unilever (HUL), and Ultratech Cement might move the index in either direction, according to Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services Ltd.
These are today's major global market cues for the Sensex:
Markets in Asia
Friday's gains in Asian markets followed Wall Street's overnight surge, which was driven by technology stocks. Prior to the Bank of Japan's monetary policy meeting, investors also evaluated Japan's December core inflation statistics, which showed the country's core inflation rate at its lowest point since June 2022.
The Topix increased by 0.98% and the Nikkei 225 of Japan rose 1.4%. The Kospi increased by 1.14% and the Kosdaq by 1.37% in South Korea. Futures on Hong Kong's Hang Seng index pointed to a flat start.
Present Nifty
Against the previous close of Nifty futures at 21,550, Gift Nifty was trading at about 21,530, suggesting a tame opening for the Indian stock market indices.
The S&P 500 is getting close to all-time highs as chipmakers continue to rally, as technology firms drove higher Wall Street US stock market indices on Thursday.
The S&P 500 increased 0.88% to close at 4,780.94, while the Dow Jones Industrial Average climbed 0.54% to 37,468.61. At 15,055.65, the Nasdaq finished 1.35% higher.
A near-10% surge in shares of US-listed Taiwan Semiconductor Manufacturing (TSMC) helped the tech-heavy Nasdaq 100 index conclude at an all-time high. It was the largest surge for the chipmakers in over a month.
While Advanced Micro Devices saw a 1.6% increase in share price, Nvidia's increased 1.9% to a record high. Shares of Marvell Technology, Qualcomm, and Broadcom increased by more than 3% apiece. Following Bank of America's upgrade of Apple stock to "Buy" with a forecast of more than 20% future growth, the company's shares surged 3.3%.
US weekly claims for unemployment decline
According to Reuters, the quantity of new claims for unemployment benefits made by Americans decreased last week to its lowest point since late 2022. According to the Labour Department, initial requests for state unemployment benefits decreased by 16,000 to a seasonally adjusted 187,000 for the week ending January 13, the lowest amount since September 2022. Economists polled by Reuters had forecast 207,000 claims for the latest week.
Dollar increases for the fifth session in a row.
Thursday saw the dollar index rise for a fifth straight session as investors became less optimistic about the US Federal Reserve cutting interest rates in March in response to positive labour market data.
The US dollar index, which compares the value of the currency to a group of six peers, was up 0.14% at 103.47 on Wednesday after hitting a record-breaking high of 103.69 on December 13. According to Reuters, it was on course for its biggest run of advances since August—five straight sessions.
Bostic of the Fed is open to early rate decreases
According to Reuters, Atlanta Federal Reserve President Raphael Bostic indicated he would be willing to lower US interest rates sooner than he had planned if "convincing" data showed that inflation is declining more quickly than he had anticipated in the upcoming months. Bostic did, however, add that the Fed's overall situation "argues for caution."
Lowest rate of inflation in Japan since June 2022
In December, Japan's core inflation rate—which does not include the cost of fresh food—declined for the second consecutive month. December had a 2.3% increase in the core consumer price index (CPI) over the previous year, which was the weakest rate of growth since June 2022. It followed a 2.5% rise in November.
