Indian shares set to open higher after US inflation data cements rate cut bets
Dec 12 (Reuters) -Indian shares are set to open higher on Thursday, tracking other Asian peers, after in-line U.S. inflation data reinforced expectations of a Federal Reserve rate cut next week.
The Gift Nifty futures GIFc1 were trading at 24,742.5, as of 7:47 a.m. IST, indicating that the benchmark Nifty 50 .NSEI will open above Wednesday's close of 24,641.8.
Other Asian markets rose on the day, with the MSCI Asia ex-Japan index .MIAPJ0000PUS gaining 0.4%.
Most Wall Street equities closed higher overnight after data showed the U.S. consumer price index (CPI) rose 0.3% on a monthly basis and 2.7% on a yearly basis in November, matching the forecast by economists polled by Reuters. MKTS/GLOB
The odds of a 25-basis-points Fed rate cut rose to about 99% after the data from 89% a day ago, according to CME FedWatch.
A Fed rate cut next week is supportive for domestic equities in general as it could bring foreign inflows. India's information technology companies, which earn a significant share of their revenue from the U.S., could also benefit from a Fed rate cut, two analysts said.
Meanwhile, economists expect domestic inflation to have eased in November, a Reuters poll showed. The data is due after market hours later in the day.
Moderate inflationmay allow the Reserve Bank of India (RBI) to cut interest rates in its next policy meeting in February amid rising growth concerns, two analysts said. The RBI kept rates unchanged in its policy meeting last week, but slashed bank's credit reserve ratio to boost liquidity.
STOCKS TO WATCH
** Godawari Power GDPI.NS enters into an agreement with GAIL GAIL.NS to supply regasified liquefied natural gas.
** Gland Pharma GLAD.NS receives U.S. drug regulator's approval for Phytonadione injectable emulsion that is used to treat blood clotting due to vitamin deficiency.
** Reliance Power RPOL.NS says its unit Reliance NU Suntech secured India's largest solar energy and battery storage project from Solar Energy Corporation of India.
** United Drilling Tools UNDR.NS secures order worth 1.49 billion rupees ($17.6 million) from Vedanta VDAN.NS.
($1 = 84.8360 Indian rupees)
Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sumana Nandy
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
