The Indian stock market indices, Nifty 50 and Sensex, are likely to open on a weak note Wednesday following negative cues from global markets.
The Asian markets were trading mostly lower, while the US stock market saw sharp losses overnight as investor sentiment remained cautious on high interest rates and its economic fallout.
On Tuesday, the domestic equity indices ended flat tracking weak global cues, as the US Treasury yields hit a multi-year high and the US dollar rose to a 10-month high level.
“Momentum is seen in Auto and defensive sectors like FMCG. Auto sector is expected to remain in focus going ahead as OEMs are likely to increase output by 25% amid a build-up in orders ahead of the festive season. The FMCG sector is looked at as a safe haven given the pressure seen in the broader markets,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.
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Here are key domestic and global markets cues for the Indian stock market today:
Asian Markets
Asian markets traded mixed on Wednesday following overnight losses on Wall Street amid concerns over a longer period of higher interest rates. Investors await China’s industrial data and Australia’s August inflation figures due today.
Japan’s Nikkei 225 declined 0.71% and the Topix fell 0.63%. South Korea’s Kospi lost 0.12%, while the Kosdaq was flat.
Hong Kong’s Hang Seng index futures at 17,477, compared to the HSI’s close of 17,466.9.
Australia’s S&P/ASX 200 dropped 0.21%
Meanwhile, Gift Nifty was trading at 19,620 against Nifty futures’ previous close of 19,666, indicating a negative start for the Indian benchmark indices.
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Wall Street
US stock market indices ended sharply lower on Tuesday as 10-year Treasury yields jumped to their multi-year highs amid worries over a long period of high interest rates and the economic fallout.
The Dow Jones Industrial Average declined 388.75 points, or 1.14%, to 33,618.13, while the S&P 500 plunged 63.77 points, or 1.47%, to 4,273.67 points. The Nasdaq Composite ended 206.02 points, or 1.55%, lower at 13,065.30.
Apple share price fell 2.3% and Microsoft shares declined 1.7%. Amazon share price tumbled 4% after the Federal Trade Commission and 17 state attorneys general filed an antitrust lawsuit against it.
Cintas dropped 5.3%.
Also Read: Global stock markets fall on interest rate fears, yields soar
US consumer confidence drops to a four-month low; home sales tumble
The US consumer confidence dropped to a four-month low in September, weighed down by a deteriorating outlook for the economy and labor market amid worries about higher prices and rising fears of a recession.
The Conference Board’s index declined to 103 this month from an upwardly revised 108.7 in August, data out Tuesday showed.
A separate from the Commerce Department showed new home sales plunged 8.7% to a seasonally adjusted annual rate of 675,000 units in August after racing to a 17-month high in July.
OpenAI seeks $90 billion valuation in possible share sale
OpenAI, the artificial-intelligence startup behind ChatGPT, is in talks with investors about a possible share sale that would value the company between $80 billion to $90 billion, the Wall Street Journal reported, citing people familiar with the discussions.
In a sale of existing shares no new capital is raised, but insiders and investors are allowed to sell their shares.
Also Read: ChatGPT-owner OpenAI skyrockets in valuation amid AI gold rush, to be valued at $90 billion after sale of existing share
Fed’s Kashkari: 40% chance of needing ‘meaningfully’ higher rates
A “soft landing” for the US economy is more likely than not, Minneapolis Federal Reserve Bank President Neel Kashkari said on Tuesday, but there is also a 40% chance that the Fed will need to raise interest rates “meaningfully” to beat inflation, Reuters reported.
Under the more likely scenario — Kashkari pegged the probability at about 60% — the Fed “potentially” raises rates one more quarter of a percentage point and then holds borrowing costs steady “long enough to bring inflation back to target in a reasonable period of time,” he said in an essay published on the regional Fed bank’s website.
Also Read: China’s economic growth target of 5% for 2023 at risk due to property crisis
Govt to issue bonds worth ₹6.55 lakh crore in H2FY24
The government will borrow ₹6.55 lakh crore in the second half of 2023-24 through dated securities, including ₹20,000 crore through issuance of Sovereign Green Bonds (SGrBs).
The government had projected gross market borrowing of ₹15.43 lakh crore for 2023-24.
Responding to market demand for longer duration securities, 50-year security will be issued for the first time, the Ministry of Finance said.
The gross market borrowing of ₹6.55 lakh crore will be completed through 20 weekly auctions. The market borrowing will be spread over 3, 5, 7, 10, 14, 30, 40 and 50-year securities, it added.
(With inputs from Reuters)
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