The Indian stock market is set to open higher on Monday, with the domestic equity benchmark indices, Sensex and Nifty 50, expected to see gains following positive sentiment in global markets. Asian markets traded mixed, while US stock futures rose after the S&P 500 had its best week of 2024.
This week, global central bank officials will gather at the symposium in Jackson Hole, Wyoming, with US Federal Reserve Chairman Jerome Powell’s keynote speech on Friday potentially setting expectations for a US rate cut trajectory. The financial markets are currently betting on a 74.5% likelihood of a 25 basis points rate cut in the US Fed’s September policy meeting, with a diminishing 25.5% chance of a 50 bps cut, according to CME’s FedWatch tool.
On Friday, the Indian stock market benchmark indices surged almost 2% each, with the Nifty 50 crossing the 24,500 mark and the Sensex surpassing 80,500. Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services, stated, “We expect the earnings momentum to continue with a steady growth of ~15% over the next 2 years (FY24-26). Softening in US PPI data has raised hopes of rate cuts in the US. Thus, all eyes this week will be on US Fed meeting minutes. Overall we expect the market to consolidate in a broader range and take cues from global factors.”
Investors will be keeping an eye on upcoming domestic and global macroeconomic data, US Federal meeting minutes, Jerome Powell’s Jackson Hole speech, foreign fund inflow, crude oil prices, and other key global geopolitical developments that could impact the Indian stock market.
Asian markets traded mixed on Monday, with MSCI’s broadest index of Asia-Pacific shares outside Japan edging up 0.2%. Japan’s Nikkei 225 recouped early losses to trade flat, while South Korea’s Kospi and Kosdaq declined. Hong Kong’s Hang Seng index futures indicated a higher opening.
Gift Nifty was trading around 24,666 level, a premium of nearly 68 points from the Nifty futures’ previous close, suggesting a positive start for the Indian stock market indices. In the US, the stock market ended higher on Friday, with the S&P 500 and Nasdaq notching their seventh straight session of gains.
US consumer sentiment rose in August, driven by developments in the race for the White House. Housing starts in the US tumbled to the lowest level since March 2023, while Japan’s core machinery orders rose more than expected in June.
Crude oil prices traded lower on Monday due to fears of weaker demand in China, with Brent crude futures dropping to $79.55 per barrel and US West Texas Intermediate crude futures falling to $76.52 a barrel. Gold prices surged to an all-time high, with spot gold surpassing $2,500 an ounce for the first time, as the dollar weakened on expectations for a US Fed interest-rate cut in September and rising tensions in the Middle East.
In conclusion, the Indian stock market is poised for a positive opening on Monday, with various global factors influencing market sentiment. Investors should stay informed about key economic data, central bank meetings, geopolitical developments, and other factors that could impact market movements. It is advisable to seek advice from certified experts before making any investment decisions.