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Market Review

US:

U.S. stocks suffered their biggest one-day percentage drop in three months on Wednesday, adding to losses after the latest Fed statement as major indexes were also pressured by a slump in Boeing and a selling of long positions by hedge funds.

Asia:

Asian shares slid on Thursday while the safe-haven dollar rallied as a sudden sell-off on Wall Street and delays with coronavirus vaccines shook investor optimism about an early recovery for the global economy.

India:

Indian markets fell sharply today to end at one-month low, with BSE Sensex closing 937 points lower at 47,409 in its biggest one-day selloff since December 21. In just four sessions, Sensex has lost about 2,400 points, giving up all the gains of this year.Market is expected to open gap down and likely to witness negative move during the day.

Economy:

New orders for key U.S.-made capital goods increased for an eighth straight month in December, pointing to solid growth in business spending on equipment in the fourth quarter and likely helping to underpin the economic recovery.

Core capital goods orders surged 1.8% year-on-year in December. Demand has shifted away from services like travel and hospitality towards goods like motor vehicles, electronics and medical equipment during the COVID-19 pandemic. That has contributed to boosting production at factories, though output remains about 2.6% below its pre-pandemic level.

Profits at China's industrial firms grew for the eighth straight month in December, suggesting a sustained recovery as the manufacturing sector rapidly emerged from its COVID-19 slump.Profits surged 20.1% year-on-year in December to 707.11 billion yuan , after rising 15.5% in November, The Federal Reserve left interest rates and its pace of bond buying unchanged following the conclusion of its first meeting of the year.

The Fed Open Market Committee kept its benchmark rate in a range of 0% to 0.25% and maintained its $120 billion monthly pace of bond purchases. The unchanged rate decision comes as the near-term economic backdrop has weakened at a time when consumers appear to be battening down the hatches following a slowdown in the labor market recovery.

Commodities:

Oil prices slid in early trade on Thursday on fresh worries about weakened fuel demand, after England clamped down on travel and China, the world's second-largest oil consumer, also sought to limit Lunar New Year trips to stem a surge in COVID-19 cases. Gold prices edged lower on Thursday as investors opted for the safety of the dollar after the U.S. Fed Reserve flagged concerns about the pace of recovery in the world's largest economy.

Currency:

The dollar extended gains against most currencies on Thursday as a stock market rout due to concerns about excessive valuations boosted safe-harbour demand for the U.S. currency.

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