Home BusinessEconomic News 6 things that changed for the stock market overnight – Gift Nifty, RBI Policy expectations to pause in US dollar rally

6 things that changed for the stock market overnight – Gift Nifty, RBI Policy expectations to pause in US dollar rally

by Clarence Jones

Global cues are mixed as Asian markets trade mostly higher, while Wall Street indices end marginally lower overnight. The domestic benchmark equity indices in India ended with decent gains on Thursday, snapping a two-day losing run. The Nifty 50 closed above 19,500, and the relief rally was led by healthy PMI data and falling crude oil prices.

The positive signal from the PMI data and the correction in crude oil prices boosted market sentiment. Reduction in FIIs selling rebound sectors like bank and IT shares. The market expects the interest rate to be held on by the RBI as external demand outlook indicates a muted trend fearing disinflationary trends in the future.

In Asian markets, Japan’s Nikkei 225 fell 0.14% and the Topix eased 0.09%, while South Korea’s Kospi gained 0.53% and the Kosdaq traded 0.98% higher. Hong Kong’s Hang Seng index futures were higher, and Chinese markets are closed for a weeklong holiday. Australia’s S&P/ASX 200 was up 0.24%.

US stock market indices ended slightly lower ahead of the monthly jobs report, which could set the tone for the US Federal Reserve’s next move for interest rates. The benchmark US Treasury yields eased from their 16-year highs hit earlier this week. The Dow Jones Industrial Average fell 9.98 points, or 0.03%, the S&P 500 eased 5.56 points, or 0.13%, and the Nasdaq Composite ended 16.18 points, or 0.12%, lower.

The Reserve Bank of India (RBI) is expected to maintain a hawkish pause as it announces its fourth bi-monthly monetary policy. The central bank is widely expected to keep the repo rate unchanged at 6.50% and maintain a hawkish pause. Economists also expect no change in stance, as RBI will keep liquidity tight. Commentary on inflation and growth trajectory will be watched.

In Japan, household spending in August decreased 2.5% from a year earlier, falling for six consecutive months. Real wages declined for a 17th month as persistent price hikes continued to outpace salary growth. Crude oil prices are heading for the biggest weekly drop since March as worries over the global economy cloud the demand outlook.

The dollar dipped ahead of US nonfarm payrolls data for potential catalysts, and the 30-year US Treasury yield stabilized. The benchmark 10-year Treasury yield and the two-year yield also stabilized.

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In conclusion, global markets are mixed as Asian markets show positive signs while Wall Street ends slightly lower. The Indian markets experienced a relief rally, and all eyes are on the RBI’s policy announcement. Economic indicators such as household spending and crude oil prices also impact market sentiments.

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