Indian stock market: The benchmark equity indices, Sensex and Nifty 50, may extend fall on Thursday amid weak global market cues.
Asian markets traded mixed, while the US stock market ended lower overnight with Treasury yields rising to one-month high levels.
Investors sentiment dampened after strong US economic data eroded hopes that the US Federal Reserve will begin its interest rate-cut campaign as early as March. Traders have trimmed the odds of a first Fed rate cut by March to 53.8%, down from 63.1% on Tuesday, according to CME’s FedWatch Tool.
On the domestic front, the Indian stock market indices, Sensex and Nifty 50 witnessed their biggest single-day percentage loss since June 2022 on Wednesday.
The Sensex cracked 1,628.01 points, or 2.23%, to end at 71,500.76, while the Nifty 50 ended 460.35 points, or 2.09%, lower at 21,571.95.
“Hawkish Fed commentary, escalating tension in the Middle East, and a spike in bond yield dented investor sentiment. On the domestic front, the market would look at quarterly results for stock-specific action and we expect indices to consolidate after a sharp sell-off,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.
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Here are key global market cues for Sensex today:
Asian Markets
Asian markets traded mixed on Thursday tracking overnight sell-off on Wall Street, with mainland Chinese shares touching a near-five-year low.
Japan’s Nikkei 225 rose 0.29%, while the Topix gained 0.28%. South Korea’s Kospi was up 0.12% and the Kosdaq rose 0.39%. Hong Kong’s Hang Seng index futures were flat.
Gift Nifty
Gift Nifty was trading around 21,415 level as compared to Nifty futures’ previous close of 21,587, indicating a negative start for the Indian equity indices.
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US Stock Market
US stock market indices ended lower on Wednesday, with the benchmark S&P 500 falling to its lowest in over a week, as Treasury yields spiked after strong December US retail sales data diminished hopes of early interest rate cut by the US Federal Reserve.
The Dow Jones Industrial Average dropped 0.25% to 37,266.67, while the S&P 500 fell 0.56% to end at 4,739.21. The Nasdaq ended 0.59% lower at 14,855.62.
Among stocks, Amazon, Nvidia and Alphabet shares declined between 0.5% and 1%. Tesla share price fell 2%. Morgan Stanley dipped 1.8, while Bank of America and Citigroup each lost about 1%.
Spirit Airlines shares tumbled 22%, Ford Motor declined 1.7%, while Boeing gained 1.3%.
US Retail Sales Data
US retail sales rose more than expected in December, the Commerce Department data showed. Retail sales rose 0.6% last month after an unrevised 0.3% gain in November. Economists polled by Reuters had forecast retail sales would gain 0.4%. Sales increased 5.6% on a year-on-year basis in December.
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Dollar at 1-month high
The US dollar held close to a one-month peak versus major peers on Thursday. The US dollar index, which measures the currency against a basket of six rivals, traded little changed at 103.36 in the Asian morning, after reaching 103.69 on Wednesday for the first time since December 13.
US Treasury Yields highest this year
US Treasury yields rose after upbeat retail sales data strengthened the case that interest rate cuts will not be as imminent as the market expects. Two-year yields rose about 13 basis points to 4.354%, their biggest daily increase in over a month. Benchmark 10-year yields added 4 bps to 4.104%, their highest since December 13.
(With inputs from Reuters)
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