Before Market Opens: 9 essential things to know at 9 am on May 2, 2024

U.S. stocks closed mixed on Wednesday after the Federal Reserve left its key interest rate unchanged, as expected, and indicated that while its next move will likely be a rate cut, continued progress on inflation is not assured. The S&P 500 and the Nasdaq ended lower while the Dow Jones Industrial Average notched a modest gain. The Dow Jones Industrial Average rose 87.37 points, or 0.23%, to 37,903.29, the S&P 500 lost 17.3 points, or 0.34%, to 5,018.39 and the Nasdaq Composite dropped 52.34 points, or 0.33%, to 15,605.48.

The US Federal Reserve announced its third interest rate decision for 2024 on May 1, after a two-day Federal Open Market Committee (FOMC) meeting, where it unanimously voted to leave the key benchmark interest rates unchanged at 5.25 percent – 5.50 percent for the sixth straight meeting, which was broadly in line with Wall Street estimates and market analysts. US Fed has now indicated of holding rates high until inflation cools and moves consistently to the target range. Fed policymakers also slightly raised the US core inflation and US GDP growth forecasts for 2024 in the previous policy meeting held in March 2024.

Asian stocks got off to a shaky start on Thursday after the Federal Reserve flagged delays to interest rate cuts, while the dollar fell heavily on the yen in what traders reckoned was Japanese intervention. Japan’s Nikkei fell 0.7% at the open and South Korean shares lost 0.5%. Australian shares were flat. S&P 500 futures rose 0.4% after the cash index had closed 0.3% lower overnight. Much of Asia is returning from a holiday that had closed markets on Wednesday, though Chinese bond, currency and stock markets remain shut through the rest of the week.

On Tuesday, the Indian stock market benchmark indices gave up day’s gains to end in the negative territory due to fag-end selloff. The Sensex declined 188.50 points, or 0.25%, to close at 74,482.78, while the Nifty 50 settled 38.55 points, or 0.17%, lower at 22,604.85. The Indian stock market was closed on Wednesday, May 1 on account of Maharashtra Day.

At 8:15 am, Gift Nifty was trading 64 points or 0.28 percent higher at 22,746, indicating a positive opening for the Indian markets.

Oil prices rose on Thursday on the prospect the U.S. may start buying crude for its petroleum reserve, after prices sank to a seven-week low on hopes for an Israel-Gaza ceasefire, doubts about U.S. interest rate cuts and swelling oil inventories. Snapping three days of losses, Brent crude futures for July gained 21 cents, or 0.3%, to $83.65 a barrel by 0026 GMT. U.S. West Texas Intermediate (WTI) crude for June climbed 22 cents, or 0.3%, to $79.22 a barrel. Both benchmarks fell more than 3% on Wednesday to a seven-week low.

Gold prices edged higher on Thursday after the U.S. Federal Reserve kept its key interest rate steady, as expected, and indicated that it is still leaning toward eventual rate cuts. Spot gold was up 0.3% at $2,323.66 per ounce, as of 0037 GMT, after climbing more than 1% in the previous session. U.S. gold futures rose 1% to $2,333.30 per ounce.

Foreign institutional investors (FIIs) net bought ₹1,071.93 crore shares, while domestic institutional investors (DIIs) pumped in ₹1,429.11 crore on April 30, provisional data from the NSE showed.

The Indian rupee on Thursday will be helped by a drop in the dollar after Federal Reserve Chair Jerome Powell said that a rate hike was unlikely. Non-deliverable forwards indicate the rupee will open mostly unchanged to the U.S. dollar from 83.4250 in the previous session. 

“The Fed was not dovish and at the same time it was not hawkish to the extent it was feared. You can see that from how the dollar and U.S. yields came off post Powell,” a forex trader at a bank said.

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Published: 02 May 2024, 08:38 AM IST