Indian stock market: 8 key things that changed for market overnight - Gift Nifty, US PMI to China stimulus measures

Indian stock market: The domestic equity indices, Sensex and Nifty 50, are expected to open higher on Tuesday following a positive trend in the global markets.

Asian markets traded higher, while the US stock market ended overnight with modest gains with the S&P 500 and Dow Jones Industrial Average touching new closing highs.

Optimism over further interest rate cuts by the US Federal Reserve and stimulus measures announced by the People’s Bank of China (PBOC) boosted investor sentiment.

On Monday, the Indian stock market indices hit another record highs and closed half a percent higher each led by buying across the board.

The Sensex gained 384.30 points, or 0.45%, to close at 84,928.61, while the Nifty 50 settled 148.10 points, or 0.57% higher at 25,939.05.

“We expect positive momentum to continue with index heavyweights continuing to outperform. We expect key events like the US GDP and Core PCE data, Fed Chair Powell’s speech and monthly derivatives expiry will keep the markets busy,” said Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services Ltd.

Here are key global market cues for Sensex today:

Asian Markets

Asian markets traded higher on optimism over China stimulus measures. MSCI’s broadest index of Asia-Pacific shares outside Japan were 0.04% higher at 586.31, levels last seen on July 15.

Japan’s Nikkei 225 rose 1.47%, while the Topix gained 1%. South Korea’s Kospi added 0.6% and the Kosdaq rose 0.68%. Hong Kong’s Hang Seng index rallied 2.18% , while the mainland Chinese CSI 300 gained 1%.

Gift Nifty Today

Gift Nifty was trading around 25,990 level, a premium of nearly 75 points from the Nifty futures’ previous close, indicating a positive start for the Indian stock market indices.

Wall Street

US stock market ended moderately higher on Monday after US Federal Reserve policymakers backed rate cuts and voiced support for more cuts in the rest of the year.

The Dow Jones Industrial Average gained 61.29 points, or 0.15%, to 42,124.65, while the S&P 500 rose 16.02 points, or 0.28%, to 5,718.57. The Nasdaq Composite ended 25.95 points, or 0.14%, higher at 17,974.27.

Tesla stock price jumped 4.65%, while Meta Platforms shares rose 0.6% and Intel share price rose 3.05%. General Motors stock fell 1.72%.

US PMI

US business activity was steady in September, but average prices charged for goods and services rose at the fastest pace in six months, Reuters reported. S&P Global said that its flash US Composite PMI Output Index was little changed at 54.4 this month compared to a final reading of 54.6 in August.

US Federal Reserve

Federal Reserve Bank of Chicago President Austan Goolsbee said he expects “many more rate cuts over the next year” as the US central bank seeks a soft landing for the economy, where it controls inflation without crashing the labor market, Reuters reported. Inflation is “way down” from its peak and in recent months has been coming in at the Fed’s 2% target, Goolsbee said.

Minneapolis Fed President Neel Kashkari said he supported the recent interest rate cut, calling it the “right decision” in light of substantial progress on inflation and the risk of an increase in unemployment, Reuters reported.

PBOC

China will cut the reserve requirement ratio (RRR), which is the cash banks need to have on hand, by 50 basis points (bps), People’s Bank of China Governor Pan Gongsheng said. He indicated that the rate cut would happen by the end of the year. PBOC would cut the 7-day repo rate by 0.2 percentage points, he added.

Japan PMI

Japan’s factory activity eased in September while the service sector saw expansion. The au Jibun Bank flash Japan composite PMI, which combines both manufacturing and service sector activity, stood at 52.5 in September, the third straight month of expansion.

The au Jibun Bank flash Japan manufacturing purchasing managers' index (PMI) fell to 49.6 in September from 49.8 in August. Flash services PMI grew to 53.9 in September, the highest level in five months, from 53.7 in August.

Oil Prices

Crude oil prices rose as intensifying conflict between Israel and Hezbollah raised supply concerns in the key Middle East producing region.

Brent crude futures for November rose 0.3% to $74.11 a barrel, while US crude futures for November gained 0.3% to $70.61.

(With inputs from Reuters)

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