Market is expected to open on a gap up note and likely to witness positive move during the day - Nirmal Bang Ltd
Market Review
US:
US stock market ended higher on Wednesday after the Federal Reserve kept interest rates unchanged as widely expected.
Asia:
Asian markets traded higher on Thursday following overnight rally on Wall Street after the US Fed policy.
India:
On Wednesday, the Indian stock market ended higher for the third consecutive session, with the benchmark Nifty 50 closing above 22,900 level. Market is expected to open on a gap up note and likely to witness positive move during the day
Global Economy:
New Zealand's GDP grew by 0.7% in Q4 2024, exceeding forecasts and ending a recession. This follows a 1.1% contraction in Q3. The central bank had projected a 0.3% rise, while analysts expected 0.4%. Despite quarterly growth, annual GDP declined by 1.1%. Industries like real estate, retail, and healthcare expanded, with tourism benefiting from increased international spending. However, sectors such as construction remain weak.
The Federal Reserve maintained interest rates at 4.25%-4.50% and announced a slowdown in its balance sheet reduction (quantitative tightening, or QT). Starting April 1, the Fed will reduce the monthly cap on maturing Treasuries from $25 bn to $5 bn, while keeping the $35 bn cap on mortgage-backed securities unchanged. This decision aims to better manage market liquidity amid uncertainties surrounding the government's borrowing limit.
Commodities:
Oil prices rose in Asian trade on Thursday, extending a recent rebound on heightened geopolitical tensions in the Middle East after the collapse of an Israel-Hamas ceasefire.
Gold hit a record high as the Federal Reserve hinted at possible interest rate cuts by year-end. This boosted gold's appeal amid ongoing geopolitical and economic uncertainties. Factors such as U.S. tariffs, tensions in the Middle East, and the possibility of rate cuts contributed to the rise in gold prices.
Currency:
The dollar was softer on Thursday after the Federal Reserve indicated interest rate cuts were likely later this year even as uncertainty around U.S. tariffs weighed, while the pound hit a four-month high ahead of the Bank of England's policy decision.
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Quote on Market Morning Inputs by Shrikant Chouhan, Head Equity Research, Kotak Securities
