Indian Equity Market: Domestic equity indices Sensex and Nifty 50 are expected to open weakly on Tuesday following mixed signals from global markets.
Asian shares were flat as U.S. stocks were closed for a holiday on Monday, as investors focused on comments from European Central Bank officials and other key economic data.
India’s major stock indexes ended flat on Monday after hitting fresh record highs in intraday trade amid profit-taking.
The Sensex index fell 19.89 points or 0.03 percent to close at 75,390.50, while the Nifty 50 index fell 24.65 points or 0.11 percent to close at 22,932.45.
“Amid the celebrations, questions have arisen regarding the sustainability of the bullish trend. Trade remained cautious yesterday in anticipation of higher volatility in the near term. Nifty closed marginally lower, highlighting the prevailing cautious sentiment in the market,” said Prashanth Tapse, senior VP (research), Mehta Equities Ltd.
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Key global market indications on Sensex today include:
Asian Market
Asian markets were range bound on Tuesday after comments from European Central Bank (ECB) officials suggested a rate cut could be on the way.
Japan’s Nikkei and TOPIX were flat. South Korea’s KOSPI rose slightly and the KOSDAQ rose 0.42%. Hong Kong’s Hang Seng Index futures posted a slightly weaker start.
Give the gift of Nifty today
GIFT Nifty was trading near the 23,020 level, up nearly 20 points from the previous day’s close of Nifty futures, signalling a flat to positive start for the Indian equity market index.
Wall Street
U.S. markets were closed on Monday for a holiday, but Nasdaq 100 futures rose 0.4% to a record high and European markets also posted modest gains.
Read also: Australian shares flat as declines in banking stocks offset rise in commodity prices
T+1 trading cycle
U.S. stock markets will shorten the settlement cycle for securities trades from two business days after trading to one business day, moving to a T+1 (Trade +1) trading cycle starting Tuesday, in accordance with Securities and Exchange Commission rules.
European Central Bank
European Central Bank (ECB) officials are arguing for a rate cut next week after ECB governing council member Olli Rehn stressed that euro zone inflation is falling “sustainably.”
“This deflation process has brought inflation toward our 2 percent objective in a sustained manner, providing an opportunity to ease the stance of monetary policy and begin to lower interest rates in June,” Lane said in his speech.
China Central Bank
The People’s Bank of China announced on May 28 that it would implement a 5 billion yuan three-month central bank bill swap.
Read also: Oil prices surge after weak week ahead of inflation data release
Oil prices
Oil prices rose amid rising geopolitical tensions in the Middle East. West Texas Intermediate rose 1.22% from Friday’s close to $78.67 a barrel. Brent traded flat at $83.06 on Monday, when there was no settlement due to a U.S. holiday.
Dollar
The US Dollar weakened on a slight increase in risk appetite but remained in a narrow range this week ahead of key inflation data releases from major economies. The US Dollar Index was down 0.01% against a basket of major currencies at 104.55.
(Quoted from Reuters)
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