India stock market: The Indian stock market indices, Sensex and Nifty 50, are expected to continue the rally towards record high following positive global cues amid optimism over dovish monetary policy by the US Federal Reserve.
Global market cues remain supportive with the Asian markets trading higher and US stock indices ending on a strong note overnight.
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The domestic benchmark indices ended at record closing high on Thursday led by upbeat investors sentiment.
The Sensex ended 929.60 points, or 1.34%, higher at 70,514.20, while the Nifty 50 surged 256.35 points, or 1.23%, to settle at 21,182.70.
“The market continued its exuberance and hit a fresh high amid the dovish commentary from the Federal Reserve, signalling at least three rate cuts in 2024. Further, the sharp fall in US bond yields improved investors’ confidence. An upgrade in India’s GDP forecast, ease in global oil prices, and the RBI decision to clamp down inflation to the target level, led to a broad-based rally with outperformance from realty and IT,” said Vinod Nair, Head of Research at Geojit Financial Services.
Here are key global market cues for Sensex today:
Asian Markets
Asian markets traded higher on Friday tracking overnight gains on Wall Street after the US Federal Reserve kept rates unchanged and laid out a roadmap for rate cuts in 2024.
Japan’s Nikkei 225 gained 0.70%, while the Topix rose 0.40%. South Korea’s Kospi traded 0.77% higher and the Kosdaq was up 0.47%. Hong Kong’s Hang Seng index futures pointed to a stronger open.
Australian shares rose to over four-month high led by better-than-expected jobs data and optimism over US Federal Reserve interest rate cut next year. The S&P/ASX 200 index rose 0.8% to 7,434.0, its highest level since August 2.
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Gift Nifty
Gift Nifty was trading around 21,418 level as against Nifty futures’ previous close of 21,353, indicating a positive start for the Indian benchmark indices.
US stock market
US stock market indices ended higher on Thursday, with the Dow Jones Industrial Average notching its second straight record closing high, amid optimism of lower borrowing rates next year after a dovish pivot by the US Federal Reserve.
The Dow Jones Industrial Average rose 0.43% to 37,248.35, while the S&P 500 gained 0.26% to end at 4,719.55. The Nasdaq Composite Index ended 0.19% higher at 14,761.56.
Among stocks, Apple shares hit an intraday record high before surrendering some of its gains to close up 0.08%. Tesla shares surged 4.9%, while Adobe share price fell 6.35%.
China’s liquidity infusion
China’s central bank offered a cash infusion in the financial system for the 13th straight month, Bloomberg reported.
The People’s Bank of China offered 1.45 trillion yuan ($204 billion) via its medium-term lending facility — 800 billion yuan more than the amount coming due in December.
European Central Bank
The European Central Bank (ECB) left the key interest rates unchanged at a record-high level of 4% for the second straight meeting and signaled an early end to its last remaining bond purchase scheme.
Read here: ECB keeps key rates steady at record 4%; lowers 2024 inflation, growth forecasts
Bank of England
The Bank of England kept its main interest rate unchanged at a 15-year high of 5.25%, where it has stood since August following the end of nearly two years of hikes. Six of the nine members of the Monetary Policy Committee voted to keep rates on hold while three wanted a quarter-point hike.
Also Read: Fed stands alone as ECB, BoE stick with tight policy
US retail sales rises
US retail sales unexpectedly rose in November as the holiday shopping season got off to a brisk start. Retail sales rebounded 0.3% last month, the Commerce Department’s Census Bureau said.
Japan’s factory activity declines
Japan’s factory activity shrank for a seventh straight month in December while the service sector made modest gains, a business survey showed on Friday, Reuters reported. The au Jibun Bank flash Japan manufacturing purchasing managers’ index (PMI) shrank to 47.7 in December from 48.3 in November, remaining below the 50.0 threshold that separates contraction for seven straight months.
(With inputs from Agencies)
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