Market is expected to open on a flattish note and likely to witness range bound move during the day - Nirmal Bang Ltd
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Market Review
US:
US stocks edged higher on Wednesday after November CPI inflation data boosted hopes for interest rates cut by the Federal Reserve later this month.
Asia:
Most indices in Asia rose, tracking Nasdaq Composite hitting its record high after November US inflation data.
India:
The NSE Nifty 50 snapped its three-session fall, and the BSE Sensex rose for the second consecutive day on Wednesday as traders await inflation data from the US later in the day and from India a day later. Market is expected to open on a flattish note and likely to witness range bound move during the day.
Global economy:
U.S. consumer prices increased in November by the most in seven months, but the Federal Reserve was still expected to deliver a third consecutive interest rate cut next week to support a labor market that has been cooling. Progress in lowering inflation toward the U.S. central bank's 2% target has virtually stalled, with the report from the Labor Department on Wednesday also showing no improvement in the measure of underlying price pressures over the past four months. Despite persistently high inflation, there was some encouraging news. Rents, one of the stickier components of inflation, rose at the slowest pace in nearly 3-1/2 years. The rise in motor vehicle insurance, another troublesome category, moderated. These factors slowed the increase in services inflation. Australia's jobless rate posted a shock decline to an eightmonth low in November, while employment extended its strong run, evidence of a far more resilient labour market than many had expected. The surprising strength prompted markets to scale back bets for an easing from the Reserve Bank of Australia in February, just days after the central bank unexpectedly turned dovish by opening the door to a rate cut.
Commodities:
Oil prices were largely muted on Thursday as traders digested a storm of factors, including more U.S. oil sanctions, fresh stimulus measures in China and a dour outlook on oil demand from the OPEC. Gold prices edged higher for a fifth consecutive session, nearing a two-week high, boosted by expectations of a Fed rate cut next week. U.S. inflation data met forecasts, reinforcing the likelihood of a third rate reduction.
Currency:
The U.S. dollar traded in a narrow range on Thursday after hitting a two-week high in the previous session, supported by a rise in U.S. Treasury yields even as market players bet the U.S. Federal Reserve will cut interest rates next week.
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