The Indian stock market is set to start cautiously on Wednesday, reflecting mixed signals from global markets. While Asian indices showed varied performance, the US stock market experienced a positive surge, with the S&P 500 marking its sixth consecutive day of gains. On Tuesday, Indian benchmarks had a somewhat indecisive session but ended with slight upward momentum.
Current Performance of Indian Indices
On Tuesday, the Sensex rose by 70.01 points, equivalent to 0.09%, closing at 80,288.38. Meanwhile, the Nifty 50 saw a modest increase of 7.45 points, or 0.03%, finishing at 24,335.95.
Market observers note a healthy trend with significant buying activities in the banking and financial sectors, alongside other heavyweights from IT, energy, and automotive industries. Ajit Mishra, Senior Vice President of Research at Religare Broking Ltd, suggests that the ongoing rotational buying could sustain a positive outlook for the indices. He emphasized that any short-term consolidation should be seen as a healthy sign for investors, who are encouraged to adopt a "buy on dips" strategy while focusing on stocks exhibiting relative strength.
Global Market Influences
Asian Market Overview
Asian markets displayed a mixed performance on Wednesday as investors braced for key economic data. Notably, Japan’s Nikkei 225 climbed by 0.14%, with the Topix up 0.5%. Conversely, South Korea’s Kospi dropped by 0.2%, and the Kosdaq fell by 0.25%.
US Market Highlights
The US stock market closed higher on Tuesday, buoyed by progress in tariff negotiations led by President Donald Trump. The Dow Jones Industrial Average surged by 300.03 points (or 0.75%) to 40,527.62, while the S&P 500 added 32.07 points (or 0.58%) to reach 5,560.82. The Nasdaq Composite finished up 95.19 points (or 0.55%) at 17,461.32.
Key stock performances included:
- Apple: +0.51%
- Nvidia: +0.27%
- Tesla: +2.15%
- General Motors: -0.6%
- Honeywell: +5.4%
- Coca-Cola: +0.8%
Trade Relations and Economic Indicators
Scott Bessent, US Treasury Secretary, stated that the US is nearing a trade agreement with India, noting that negotiations have been smoother due to high tariffs. He indicated that India could be one of the first nations to finalize a bilateral trade deal with the US, aiming to avoid reciprocal tariffs.
Currency and Treasury Yields
The dollar index, measuring the US dollar against other currencies, rose by 0.2% to 99.23. The euro dropped by 0.35% to $1.1381, while the dollar strengthened against the Japanese yen, reaching 142.32.
In terms of treasury yields, the 10-year US Treasury yield fell for the sixth consecutive day, dipping to 4.17%. The 30-year bond yield also decreased to 4.6431%.
Commodity Prices
Crude oil prices experienced a downturn as concerns about global economic growth and fuel demand rose due to Trump’s tariff policies. Specifically, Brent crude futures fell 0.26% to $64.08 per barrel, while West Texas Intermediate crude dropped 0.2% to $60.3.
Gold Prices
Gold prices remained steady as investors awaited developments in trade relations. Spot gold traded at $3,318.79 per ounce, while US gold futures saw a slight decline of 0.2%, settling at $3,328.50.
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