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Indian stock market: The domestic equity market indices, Sensex and Nifty 50, are expected to open higher on Wednesday, despite cautiousness in the global markets ahead of the US Federal Reserve policy decision.

Asian markets traded lower, while the US markets also ended in the red overnight ahead of the expected Fed rate cut.

On Tuesday, the Indian stock market ended with strong gains on optimism over a potential India–US trade deal and expectations of a 25-bps rate cut by the US Federal Reserve.

The Sensex rallied 594.95 points, or 0.73%, to close at 82,380.69, while the Nifty 50 settled 169.90 points, or 0.68%, higher at 25,239.10.

“We now look for a move toward 25,500 and recommend continuing with a ‘buy on dips’ strategy, focusing on quality names across sectors. That said, global monetary policy decisions and trade developments are expected to drive near-term volatility, so aggressive positioning should be avoided,” said Ajit Mishra – SVP, Research, Religare Broking Ltd.

Here are key global market cues for Sensex today:

Asian markets traded lower on Wednesday, tracking overnight losses on Wall Street amid cautiousness ahead of the US Federal Reserve meeting. Japan’s Nikkei 225 index fell 0.45%, while the Topix index dropped 0.65%. South Korea’s Kospi index declined 0.80%, while the Kosdaq fell 0.78%. Hong Kong’s Hang Seng Index futures indicated a higher opening.

Gift Nifty was trading around 25,392 level, a premium of nearly 61 points from the Nifty futures’ previous close, indicating a positive start for the Indian stock market indices.

US stock market ended lower in choppy trading on Tuesday as caution set in ahead of an anticipated interest rate cut from the Federal Reserve.

The Dow Jones Industrial Average declined 125.55 points, or 0.27%, to 45,757.90, while the S&P 500 fell 8.52 points, or 0.13%, to 6,606.76. The Nasdaq Composite closed 14.79 points, or 0.07%, lower at 22,333.96.

Nvidia share price fell 1.6%, Tesla stock price rallied 2.77%, UnitedHealth Group shares fell 2.3%, Webtoon Entertainment shares soared 39% and Oracle stock rose 1.5%.

India and the US termed the talks between Chief US negotiator Brendan Lynch and Indian counterpart Rajesh Agrawal, the Special Secretary in the Department of Commerce, on the proposed bilateral trade agreement as “positive and forward-looking”. The two countries also decided to intensify efforts to reach a mutually beneficial trade agreement at the earliest.

China called the framework deal to switch short-video app TikTok to US-controlled ownership a “win-win” and said it would review TikTok’s technology exports and intellectual property licensing. Investors now await a call scheduled for Friday between US President Donald Trump and Chinese President Xi Jinping in which the agreement should be confirmed.

US retail sales increased more than expected in August, its third straight month of solid gains in sales. Retail sales rose 0.6% last month after an upwardly revised 0.6% advance in July. Economists polled by Reuters had forecast retail sales, which are mostly goods and are not adjusted for inflation, rising 0.2% following a previously reported 0.5% gain in June. Sales increased 5.0% on a year-over-year basis.

US factory production unexpectedly increased in August. Manufacturing output rose 0.2% last month after a downwardly revised 0.1% fall in July. Economists polled by Reuters had forecast production for the sector would slip 0.2% following a previously reported unchanged reading in July. Production at factories increased 0.9% on a year-over-year basis in August.

Japan’s exports fell for a fourth straight month in August. Total exports by value dropped 0.1% YoY in August, less than a median market forecast for a 1.9% decrease and following a 2.6% fall in July. Imports dropped 5.2% in August from a year earlier, compared with market forecasts for a 4.2% increase, Reuters reported. As a result, Japan ran a trade deficit at 242.5 billion yen ($1.66 billion) in August, compared with the forecast of a deficit of 513.6 billion yen.

The US dollar loitered near four-year lows against the euro and a one-month trough against the yen. The dollar index, which measures the US unit against six others, was at 96.686, languishing near its lowest since early July. The euro wobbled at $1.1858, Sterling was steady at $1.3649, and the Japanese yen firmed to 146.22 per dollar.

Gold prices hovered near all-time highs on expectations for a Fed rate cut later in the day. Spot gold prices held its ground at $3,690.09 per ounce, after hitting a record high of $3,702.95 on Tuesday. US gold futures for December delivery rose 0.1% higher to $3,727.30.

(With inputs from Reuters)

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

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