The Indian stock market is set to open on a muted note on Friday, with the domestic stock market indices, Sensex and Nifty 50, expected to track weakness in global markets. Asian markets traded mixed, while the US stock market ended lower overnight due to selling in technology stocks and a spike in Treasury yields.
Central bank officials from around the world have gathered in Jackson Hole for the annual Economic Symposium. Investors will be closely watching US Federal Reserve Chairman Jerome Powell’s address on Friday for clues on the timing and extent of the Fed’s policy easing cycle.
On Thursday, the Indian stock market indices ended higher, with the Nifty 50 closing above the 24,800 level. The Sensex ended 147.89 points, or 0.18%, higher at 81,053.19, while the Nifty 50 settled 41.30 points, or 0.17%, higher at 24,811.50.
Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services Ltd., stated, “All eyes will be on tomorrow’s US Fed Chair Powell’s speech at the Jackson Hole Symposium. Investors would look for hints on interest rate cuts. Hopes are running high for a rate cut in the September meeting followed by more rate cuts in subsequent meets. The market thus is likely to consolidate in the near term. While sectorial rotation and stock-specific action will be at play.”
Asian markets traded mixed on Friday following a sell-off on Wall Street overnight and the release of Japan’s inflation data. Japan’s Nikkei rose 0.2%, while the Topix climbed 0.32%. Hong Kong Hang Seng index futures indicated a lower opening.
Gift Nifty was trading around the 24,830 level, a discount of nearly 10 points from the Nifty futures’ previous close, indicating a mildly negative start for the Indian stock market indices.
The US stock market ended lower on Thursday, with the Dow Jones Industrial Average declining 177.71 points, or 0.43%, to 40,712.78, the S&P 500 dropping 50.21 points, or 0.89%, to 5,570.64, and the Nasdaq Composite ending 299.63 points, or 1.67%, lower at 17,619.35. Technology shares saw selling pressure as Treasury yields rose and global central bank officials convened at the Jackson Hole Economic Symposium.
In terms of economic data, the number of Americans filing new applications for unemployment benefits rose in the latest week, while US existing home sales rose more than expected in July, reversing four consecutive monthly declines.
The minutes of the Reserve Bank of India’s latest policy meeting on August 8 showed that all three internal members of the Monetary Policy Committee panel elaborated on the need to retain food prices within the central bank’s broader inflation target.
Japan’s core inflation accelerated for a third straight month in July, with the nationwide core consumer price index rising 2.7% from a year earlier. However, the “core core” index, which excludes fresh food and energy costs, dipped below the key 2% line for the first time since September 2022.
US Treasury yields rose, recovering from two-week lows hit the previous session. The benchmark 10-year yield rose to 3.861%, the 30-year yields climbed to 4.134%, and the two-year yield advanced to 4.009%.
In conclusion, the Indian stock market is expected to open on a muted note on Friday, with investors closely watching global market cues and economic data for further direction. It is important for investors to stay informed and seek advice from certified experts before making any investment decisions.