Indian stock market: From Gift Nifty to Yen’s rise - 6 key things that changed for market overnight

Indian stock market: The domestic equity market indices, Sensex and Nifty 50, are likely to open higher on Thursday amid mixed global cues.

On Wednesday, the Indian stock market indices ended lower tracking weakness in global peers.

The Sensex declined 202.80 points, or 0.25%, to close at 82,352.64, while the Nifty 50 settled 81.15 points, or 0.32%, lower at 25,198.70.

“Markets, after gaining in the last two weeks, saw a decline amid global concerns. However, buying at lower levels indicates the resilience of domestic equities in the face of global volatility. We expect Nifty to consolidate at a higher zone with intermittent volatility as key US economic data are lined up this week. Defensive sectors like FMCG & Pharma are likely to remain in focus,” 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 recovered some of the ground following a worldwide sell-off, according to a Bloomberg report, as traders anticipated this week's US payrolls data to determine the degree of the Federal Reserve's easing. The value of the dollar remained stable.

After plunging more than 2% on Wednesday—its worst decline since the crushing defeat on August 5—the MSCI Asia Pacific Index increased by 0.5%. The rise in chipmaker stocks drove a more than 1% increase in the Kospi index of South Korea. Japan's benchmarks changed in tandem with the strength of the yen. The yen lost some of its previous strength. Surprising gains in real earnings kept the yen strong and the Bank of Japan on course for another rate hike.

Gift Nifty Today

At 07:22 IST, Gift Nifty was trading around 25,366.50 level, a premium of nearly 116 points from the Nifty futures’ previous close, indicating a positive start for the Indian stock market indices.

Wall Street

A day after the market saw its biggest slump in a month, Wall Street continued to lose ground on Wednesday as US stock indexes continued to fall, with losses accruing from the technology, energy, and other sectors.

Following a 2.1% decline on Tuesday, the S&P 500 dropped by 0.2%. The Nasdaq composite also decreased by 0.3%. Despite this, the Dow Jones Industrial Average saw an increase of 0.1%.

A government data revealing unusually low job opportunities in the USin July suggested that hiring may slow down in the upcoming months, which coincided with the market's most recent decline. Investors and the Federal Reserve are keeping a close eye on the employment market as a sign of how strong the economy is. It is expected by Wall Street traders that the Fed will begin reducing its benchmark interest rate during its meeting later in September.

Gains in Yen affect Japan Stocks

The yen gained strength and the dollar remained weak as investors anticipated an upcoming interest-rate cut by the Federal Reserve in response to disappointing US jobs data, according to a Bloomberg report.

The Nikkei 225 index in Japan dropped by 0.5% while the yen continued to strengthen against the US dollar for the third consecutive day, buoyed by an unexpected increase in real wages, which reinforces the likelihood of another rate hike by the Bank of Japan.

Dollar slips ahead of US payrolls data

The data on US job openings in July indicated a weakening labor market, which increased the likelihood of more interest cuts by the Federal Reserve. As a result, the dollar declined against most major currencies on Wednesday, according to a report by Reuters.

The dollar index, which assesses the strength of the US currency against six major counterparts, experienced a 0.3% decrease, settling at 101.4. At 144.07 yen, the dollar declined by 1%, reaching a one-week low, while global financial markets generally steered clear of riskier assets.

Crude Oil

On Wednesday, crude futures experienced a drop of over $1 per barrel in fluctuating trading, as concerns about future demand and mixed signals from crude producers regarding supply increases weighed on traders' minds. The settlement saw Brent crude futures decreasing by $1.05 or 1.42% to reach $72.70 per barrel, while U.S. West Texas Intermediate crude futures settled down $1.14, or 1.62%, at $69.20.

Throughout the session, both benchmarks exhibited significant swings, fluctuating between a $1 decrease and a $1 increase in response to reports of OPEC's discussions about the potential delay of an output increase due to anticipated rise in Libyan production.

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