Pre Session- Global Gloom amid pre-Fed jitters may take toll on Sensex
14/12/2015
The key Indian equity benchmarks could fall prey to a widespread global sell-off amidst a continued commodity rout and heightened investor anxiety ahead of the US Federal Reserve’s two-day monetary policy meet beginning on Tuesday, in which the world’s biggest central bank is poised to raise interest rates for the first time in almost a decade. A hike in US interest rates from near zero levels may make emerging market assets relatively less attractive, raising fears over a capital flight from EMs. The CNX Nifty Index futures for December delivery slumped by 0.67 per cent or 50.50 points at 7,570 at 10:24 am Singapore time, signaling a gap down opening for Dalal Street on Monday as weak global cues coupled with fears over a delay in the GST reform as the Winter Session of Parliament heads for another washout amidst opposition protests, sour investor mood. Caution ahead of the retail inflation data to be released after-market hours today which may show that India’s consumer inflation spiked to a five-month high of 5.4 per cent in November 2015 from October’s 5 per cent, thereby limiting near-term policy easing room for the RBI, may also weigh on Dalal Street. The Wholesale Inflation data for the month of November will be released during market hours on Monday. The Sensex may receive some support from Friday’s upbeat IIP data which showed that the country’s industrial production expanded at the fastest pace since October 2010, up 9.8 per cent in October 2015 from the same month a year ago led by an upturn in manufacturing as output of consumer durables and capital goods surged, signaling a pickup in Asia’s third biggest economy. On Friday, the Sensex tumbled by 207.89 points or by 0.82 per cent to end at 25,044.43, plummeting to the lowest level in three months as continued Parliamentary logjam threatened to derail the progress of key reforms while caution ahead of the Fed meet also weighed on sentiment.
Asian stocks plunged the most since September, as an oil rout worsened while jitters ahead of the much anticipated Fed meeting this week also soured the appetite for risky assets. China’s Shanghai Composite succumbed to modest losses even as the country’s industrial output, retail sales and fixed-asset investment numbers for November, came in better-than-expected, easing concerns over a slowdown in the world’s second biggest economy. China’s industrial output climbed 6.2 per cent, year on year in November 2015, topping estimates for a 5.7 per cent annual gain, while retail sales rose 11.2 per cent, the biggest advance this year, and fixed-asset investment for the first eleven months of 2015 increased 10.2 per cent. Hang Seng plummeted by 1.4 per cent while Japan’s Nikkei 225 shed more than 2 per cent driven by a plunge in shares of energy exporters as a rout in US and Europe spread to Asia. Doom and Gloom struck Wall Street on Friday with benchmarks marking their worst week since August as a worsening commodity sell-off raised concerns over the global economic recovery, fueling deflation fears, overshadowing optimism that the world’s biggest economy will withstand the impact of higher interest rates. Investors cast aside upbeat US retail sales data which showed that sales rose the most in four months, up by 0.2 per cent in November 2015. The Dow Jones Industrial Average slid 1.76 per cent and the tech-heavy Nasdaq Composite tumbled 2.21 per cent while the S&P 500 shed 1.94 per cent on Friday.
14/12/2015
The key Indian equity benchmarks could fall prey to a widespread global sell-off amidst a continued commodity rout and heightened investor anxiety ahead of the US Federal Reserve’s two-day monetary policy meet beginning on Tuesday, in which the world’s biggest central bank is poised to raise interest rates for the first time in almost a decade. A hike in US interest rates from near zero levels may make emerging market assets relatively less attractive, raising fears over a capital flight from EMs. The CNX Nifty Index futures for December delivery slumped by 0.67 per cent or 50.50 points at 7,570 at 10:24 am Singapore time, signaling a gap down opening for Dalal Street on Monday as weak global cues coupled with fears over a delay in the GST reform as the Winter Session of Parliament heads for another washout amidst opposition protests, sour investor mood. Caution ahead of the retail inflation data to be released after-market hours today which may show that India’s consumer inflation spiked to a five-month high of 5.4 per cent in November 2015 from October’s 5 per cent, thereby limiting near-term policy easing room for the RBI, may also weigh on Dalal Street. The Wholesale Inflation data for the month of November will be released during market hours on Monday. The Sensex may receive some support from Friday’s upbeat IIP data which showed that the country’s industrial production expanded at the fastest pace since October 2010, up 9.8 per cent in October 2015 from the same month a year ago led by an upturn in manufacturing as output of consumer durables and capital goods surged, signaling a pickup in Asia’s third biggest economy. On Friday, the Sensex tumbled by 207.89 points or by 0.82 per cent to end at 25,044.43, plummeting to the lowest level in three months as continued Parliamentary logjam threatened to derail the progress of key reforms while caution ahead of the Fed meet also weighed on sentiment.
Asian stocks plunged the most since September, as an oil rout worsened while jitters ahead of the much anticipated Fed meeting this week also soured the appetite for risky assets. China’s Shanghai Composite succumbed to modest losses even as the country’s industrial output, retail sales and fixed-asset investment numbers for November, came in better-than-expected, easing concerns over a slowdown in the world’s second biggest economy. China’s industrial output climbed 6.2 per cent, year on year in November 2015, topping estimates for a 5.7 per cent annual gain, while retail sales rose 11.2 per cent, the biggest advance this year, and fixed-asset investment for the first eleven months of 2015 increased 10.2 per cent. Hang Seng plummeted by 1.4 per cent while Japan’s Nikkei 225 shed more than 2 per cent driven by a plunge in shares of energy exporters as a rout in US and Europe spread to Asia. Doom and Gloom struck Wall Street on Friday with benchmarks marking their worst week since August as a worsening commodity sell-off raised concerns over the global economic recovery, fueling deflation fears, overshadowing optimism that the world’s biggest economy will withstand the impact of higher interest rates. Investors cast aside upbeat US retail sales data which showed that sales rose the most in four months, up by 0.2 per cent in November 2015. The Dow Jones Industrial Average slid 1.76 per cent and the tech-heavy Nasdaq Composite tumbled 2.21 per cent while the S&P 500 shed 1.94 per cent on Friday.
