Pre Session- Positive opening seen for Sensex; Fed decision eyed
16/03/2016
Indian equity benchmarks are likely to witness a gap up opening on Wednesday as traders across the globe await the conclusion of the US Federal Reserve’s two-day monetary policy meet which began on Tuesday, in which the world’s top central bank is likely to offer cues over the path to raising interest rates further following a maiden hike in borrowing costs in almost a decade in December. Strength in the CNX Nifty Index futures for March delivery which climbed by 0.27 per cent or 20.5 points at 7,504 at 10:24 am Singapore time, signals a gap up opening for the Sensex today. Rising speculation of an interest rate cut of at least 25 bps by the Reserve Bank of India (RBI) at its upcoming policy meet on April 5, 2016 may continue to support domestic market sentiment. Easing consumer inflation in February and the government’s commitment to stick to its fiscal deficit targets in the Union Budget has opened the door for further monetary easing from the central bank to help buoy demand and revive investments in Asia’s third biggest economy. Snapping a two-day rally, the 30-share Sensex on Tuesday tumbled by 253.11 points or by 1.02 per cent to end at 24,551.1 amid a sell-off in pharma stocks and muted global cues ahead of the Fed decision.
Asian stocks were trading mixed as material shares retreated amid a commodity sell-off while sentiment remained subdued before a Fed policy decision. While the Fed is likely to keep interest rates unchanged on Wednesday, the tone of its statement will be keenly watched to assess the trajectory of further rate hikes in the world’s biggest economy. China’s Shanghai Composite and Hang Seng logged modest gains as investors awaited Chinese Premier Li Keqiang’s address at the conclusion of annual policy meetings where he may indicate whether the government will continue to directly support the country’s stock market. Japan’s Nikkei 225 fell as a stronger yen dimmed the lure for Japanese exporter companies. Wall Street ended on a subdued note on Tuesday as investors pondered whether central banks still have the capacity to help bolster a flagging economic recovery. The Bank of Japan refrained from additional stimulus while the Fed kicked off a two-day meet on Tuesday. Sentiment also took a hit from tepid US retail sales data which signaled underlying softness in the world’s biggest economy. US retail sales fell 0.1 per cent in February from January when they declined a revised 0.4 per cent. The Dow Jones Industrial Average climbed 0.13 per cent; the Nasdaq Composite fell 0.45 per cent while S&P 500 declined 0.18 per cent.
16/03/2016
Indian equity benchmarks are likely to witness a gap up opening on Wednesday as traders across the globe await the conclusion of the US Federal Reserve’s two-day monetary policy meet which began on Tuesday, in which the world’s top central bank is likely to offer cues over the path to raising interest rates further following a maiden hike in borrowing costs in almost a decade in December. Strength in the CNX Nifty Index futures for March delivery which climbed by 0.27 per cent or 20.5 points at 7,504 at 10:24 am Singapore time, signals a gap up opening for the Sensex today. Rising speculation of an interest rate cut of at least 25 bps by the Reserve Bank of India (RBI) at its upcoming policy meet on April 5, 2016 may continue to support domestic market sentiment. Easing consumer inflation in February and the government’s commitment to stick to its fiscal deficit targets in the Union Budget has opened the door for further monetary easing from the central bank to help buoy demand and revive investments in Asia’s third biggest economy. Snapping a two-day rally, the 30-share Sensex on Tuesday tumbled by 253.11 points or by 1.02 per cent to end at 24,551.1 amid a sell-off in pharma stocks and muted global cues ahead of the Fed decision.
Asian stocks were trading mixed as material shares retreated amid a commodity sell-off while sentiment remained subdued before a Fed policy decision. While the Fed is likely to keep interest rates unchanged on Wednesday, the tone of its statement will be keenly watched to assess the trajectory of further rate hikes in the world’s biggest economy. China’s Shanghai Composite and Hang Seng logged modest gains as investors awaited Chinese Premier Li Keqiang’s address at the conclusion of annual policy meetings where he may indicate whether the government will continue to directly support the country’s stock market. Japan’s Nikkei 225 fell as a stronger yen dimmed the lure for Japanese exporter companies. Wall Street ended on a subdued note on Tuesday as investors pondered whether central banks still have the capacity to help bolster a flagging economic recovery. The Bank of Japan refrained from additional stimulus while the Fed kicked off a two-day meet on Tuesday. Sentiment also took a hit from tepid US retail sales data which signaled underlying softness in the world’s biggest economy. US retail sales fell 0.1 per cent in February from January when they declined a revised 0.4 per cent. The Dow Jones Industrial Average climbed 0.13 per cent; the Nasdaq Composite fell 0.45 per cent while S&P 500 declined 0.18 per cent.
