Stock market today: The domestic market benchmark indices are expected to have a flat-to-negative opening on Monday’s trade with GIFT Nifty down 10.2 points from Friday’s close on Nifty Futures amid mixed global cues. The Gift Nifty is trading around 21,080 level as compared to the Nifty futures’ previous close of 21,090.20.
Early trading saw gains in Asian stocks, despite caution, as investors got ready for a week that included important US inflation data and the Federal Reserve’s final rate decision of the year among several central bank meetings, as per reports.
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On Friday, the domestic equities benchmark indices, Nifty 50, and the Sensex ended in green led by gains in banking and IT stocks, and after Reserve Bank of India’s (RBI) maintained its policy rates and stance, as expected.
The RBI raised its forecast for GDP growth in the fiscal year 2024, maintained the policy stance of “withdrawal of accommodation,” and left the repo rate at 6.5% unchanged. In spite of this, the central bank maintained its forecast for inflation, estimating 5.4% for FY24 for retail inflation, or inflation based on the Consumer Price Index (CPI).
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During the session, the Nifty 50 reached an all-time high of 21,006.10, breaking through the 21,000 barrier for the first time. During the session, the Sensex reached a new record high of 69,893.8.
The Sensex finished the day up 304 points, or 0.44%, at 69,825.60, while the Nifty 50 closed at 20,969.40, up 68 points, or 0.33%.
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“Nifty hit the 21K-mark after the RBI hiked GDP growth forecast to 7% and left inflation projection unchanged at 5.4% for FY24. The RBI maintained its status quo and kept repo rate unchanged at 6.5% for the fifth time. The index closed with gains of 68 points at 20969 levels. IT, Banking, Financials and Realty sectors were major gainers today.
Markets on Monday would react to US Nonfarm Payroll and Unemployment rate data to be release late Friday. Further, major central banks globally are lined up next week to announce their policy decision, which is likely to keep the market range bound,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.
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GIFT Nifty
The Gift Nifty is trading around 21,080 level as compared to the Nifty futures’ previous close of 21,090.20. It is down 10.2 points from Friday’s close on Nifty Futures amid mixed global cues.
“During the week, the Nifty witnessed a spectacular rally following a swing high breakout on the daily chart. This suggests a rise in optimism among market participants. However, the Nifty consolidated in the later part of the week.
Going forward, 21,000 is likely to act as a crucial level for the Nifty as call writers have built their maximum positions at that strike price. A resumption of the current uptrend might be seen above 21000, with the potential to reach towards 21,550. On the lower end, put writers have built significant positions at 20,900 and 20,800; below these levels, profit booking might increase,” said Rupak De, Senior Technical analyst at LKP Securities.
Asian Markets
A Bloomberg report stated that Asian stocks rose early in trading as investors got ready for a week that will feature important US inflation data and the Federal Reserve’s annual rate decision, among several other central bank meetings.
Australian and Korean shares also saw gains, and Japanese benchmark indexes surged by at least 1%. After Wall Street rose on Friday to record a sixth consecutive weekly gain, futures contracts for US shares saw little movement. Following stronger-than-expected US jobs data on Friday, Treasury yields continued to rise in Asian trading.
Japan’s Nikkei rose 1.2% last week, as per Reuters reports, following a 3.4% decline the previous week on rumours of an end to the ultra-easy monetary policy. Futures for the S&P 500 and the Nasdaq saw minimal changes.
China’s markets could face more challenges this week following the release of data indicating that consumer prices dropped 0.5% in November—the biggest decline since late 2020.
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US Payroll data
A report by Reuters said that US job growth picked up speed in November. The Labour Department’s employment report indicated that nonfarm payrolls climbed by 199,000 jobs last month, surpassing the 180,000 estimate of Reuters-surveyed economists. This followed an unrevised 150,000 job increase in October. From October’s almost two-year high of 3.9%, the unemployment rate dropped to 3.7%.
Wall Street
The US Treasury yields increased after a strong US jobs report forced markets to reevaluate expectations for the timing of rate cuts by the Federal Reserve. A Reuters report states that a gauge of global stocks rose on Friday, on track for its sixth straight week of gains.
As oil prices rebounded, energy shares led the S&P 500 to a four-month high while stocks rose in choppy trading. The S&P 500 gained 16.15 points, or 0.35 percent, to 4,601.74, the Nasdaq Composite gained 62.39 points, or 0.44 percent, to 14,402.38, and the Dow Jones Industrial Average increased by 109.47 points, or 0.30%, to 36,227.
China’s consumer prices
A Bloomberg report highlighted that the difficulties facing the economic recovery by stating that producer costs fell even further into negative territory while consumer prices in China fell at the fastest rate in three years.
In a statement released on Saturday, the national statistics bureau stated that the consumer price index decreased by 0.5% from a year ago last month. It is less than the 0.2% decline that economists predicted in a Bloomberg survey, despite being the largest decline since November 2020.
Dollar Index
As per Reuters, the dollar gained momentum on Monday, as the Federal Reserve’s final policy meeting of the year and a reading on US inflation were expected to set the tone for the week.
Crude Oil
A report from Reuters states that although worries about an oversupply of crude and slower-than-expected growth in fuel demand next year persisted, oil prices increased on Monday, extending gains for a second session.
At 01:19 GMT, U.S. West Texas Intermediate crude futures were up 7 cents, or 0.1%, to $71.30 per barrel, while Brent crude futures increased 11 cents, or 0.2%, to $75.95 a barrel.
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