Pre Session- Gap up opening on the cards for Dalal Street
02/12/2015
The key Indian equity benchmarks are poised to extend a four-day rally and open higher on Wednesday as Dalal Street traders take comfort from a fairly dovish monetary policy statement from the Reserve Bank of India (RBI) which left the room open for further interest rate cuts in Asia’s third biggest economy, depending on the inflation trajectory. While the RBI is almost certain to meet its 6 per cent consumer inflation target for January 2016, it is now eying the 5 per cent goal for March 2017. Strength in the CNX Nifty Index futures for December delivery which rallied 0.26 per cent or 20.5 points at 8,005.5 at 10:50 am Singapore time, signals a positive opening for the Sensex on Wednesday. Speculation that the US Federal Reserve may take a gradual approach to raising interest rates after US manufacturing succumbed to a surprise contraction in the month of November, and hopes that the European Central Bank (ECB) may boost stimulus when it meets on Thursday, also bolstered the appetite for risky assets. Marking a fourth straight rally, the 30-share Sensex climbed to the highest level in four weeks, advancing 23.74 points or by 0.09 per cent to end at 26,169.41 on Tuesday when the RBI left key interest rates unchanged amidst a pickup in inflationary pressures due to higher food costs, and caution ahead of the US Fed’s policy meet in mid-December, in which a rate lift-off is expected, the first in almost a decade.
Asian stocks were trading on a mixed note as tepid factory data from the US raised doubts over the world’s biggest economy to withstand rate tightening. China’s Shanghai Composite surged over 1 per cent on hopes of further stimulus by policymakers as a worsening manufacturing rout signaled fears of a hard landing in China’s economy. The official China factory gauge fell to the lowest level in three years at 49.6 in November from 49.8 in October, with a reading below 50 signaling contraction. Hang Seng advanced but Japan’s Nikkei 225 fell as an unexpected US manufacturing contraction clouded US Fed rate outlook. Wall Street ended on a bullish note on Tuesday as the fastest pace of US manufacturing contraction since 2009 in November raised hopes that the Fed may not hike borrowing costs quickly, even if it decides to undertake the initial lift-off in rates this month.
02/12/2015
The key Indian equity benchmarks are poised to extend a four-day rally and open higher on Wednesday as Dalal Street traders take comfort from a fairly dovish monetary policy statement from the Reserve Bank of India (RBI) which left the room open for further interest rate cuts in Asia’s third biggest economy, depending on the inflation trajectory. While the RBI is almost certain to meet its 6 per cent consumer inflation target for January 2016, it is now eying the 5 per cent goal for March 2017. Strength in the CNX Nifty Index futures for December delivery which rallied 0.26 per cent or 20.5 points at 8,005.5 at 10:50 am Singapore time, signals a positive opening for the Sensex on Wednesday. Speculation that the US Federal Reserve may take a gradual approach to raising interest rates after US manufacturing succumbed to a surprise contraction in the month of November, and hopes that the European Central Bank (ECB) may boost stimulus when it meets on Thursday, also bolstered the appetite for risky assets. Marking a fourth straight rally, the 30-share Sensex climbed to the highest level in four weeks, advancing 23.74 points or by 0.09 per cent to end at 26,169.41 on Tuesday when the RBI left key interest rates unchanged amidst a pickup in inflationary pressures due to higher food costs, and caution ahead of the US Fed’s policy meet in mid-December, in which a rate lift-off is expected, the first in almost a decade.
Asian stocks were trading on a mixed note as tepid factory data from the US raised doubts over the world’s biggest economy to withstand rate tightening. China’s Shanghai Composite surged over 1 per cent on hopes of further stimulus by policymakers as a worsening manufacturing rout signaled fears of a hard landing in China’s economy. The official China factory gauge fell to the lowest level in three years at 49.6 in November from 49.8 in October, with a reading below 50 signaling contraction. Hang Seng advanced but Japan’s Nikkei 225 fell as an unexpected US manufacturing contraction clouded US Fed rate outlook. Wall Street ended on a bullish note on Tuesday as the fastest pace of US manufacturing contraction since 2009 in November raised hopes that the Fed may not hike borrowing costs quickly, even if it decides to undertake the initial lift-off in rates this month.
