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Market Review

US:

U.S. stocks surged on Wednesday, with all three major indexes registering their biggest daily percentage gains in more than two months, as lower-than-expected Dec’24 core inflation data and solid earnings from major U.S. banks fueled a rally.

Asia:

Stocks in the Asia-Pacific region advanced on Thursday following a surge in US markets taking overnight cues from Wall Street as easing inflation increased the prospects of rate cuts by the Federal Reserve.

India:

India's benchmark indexes inched higher on Wednesday, led by energy and information technology stocks, although worries over slowing earnings and caution ahead of key U.S. inflation data capped the gains.

Market is expected to open on a gap up note and likely to witness range bound move during the day.

Global economy:

U.S. inflation rose to 2.9% in December, driven by gas, eggs, and used car prices, while core inflation eased slightly to 3.2%. Economists anticipate inflation to decrease slightly, despite potential inflationary policies from President-elect Trump. The Fed is expected to maintain high interest rates until inflation returns to 2%, impacting borrowing costs. Japan's annual wholesale inflation held steady at 3.8% in December on stubbornly high food costs, highlighting persistent price pressures that may prod the central bank to raise interest rates next week. Australian employment sped past forecasts in December thanks to a surge in part-time jobs, though the jobless rate ticked higher as more people went looking for work. Figures from the Australian Bureau of Statistics showed net employment jumped 56,300 in December from November, when it increased by a downwardly revised 28,200. That was well above market forecasts for a rise of 15,000. Annual jobs growth accelerated to a brisk 3.1%.

Commodities:

Oil prices rose in Asian trade on Thursday after hitting multi-month peaks in the previous session, driven by a combination of softer U.S. inflation data, new sanctions on Russian oil, and significant drawdowns in U.S. crude inventories. US gold prices hit more than one-month highs on Thursday in early Asian hours after data showed US core inflation rose less than expected in December, raising hopes that the Federal Reserve could ease interest rates further.

Currency:

The dollar slipped on Thursday to stand just off recent peaks as cooling U.S. inflation data knocked down bond yields, while the yen hit a one-month high on rising bets on a rate hike in Japan.

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