Indian stock market: 10 key things that changed for market overnight – Gift Nifty, US inflation to India’s Q3 GDP data

Asian markets traded mostly higher, while the US stock market indices rallied overnight after the inflation data and comments from the US Federal Reserve officials helped shape expectations for the timing of the central bank’s interest rate cuts.

Stock market investors are likely to react to  a slew of data released overnight, including US inflation, jobless claims, India’s Q3 GDP growth, fiscal deficit and others.

Meanwhile, the Indian stock market indices ended Thursday’s volatile session on a higher note amid mixed global cues.

The Sensex gained 195.42 points, or 0.27%, to close at 72,500.30, while the Nifty 50 settled 31.65 points, or 0.14%, higher at 21,982.80.

“Recent global economic data releases pushed investors back after a rally that was seen recently. Further, the US Fed’s preferred inflation gauge, personal consumption expenditures (PCE), holds key importance from an interest rate perspective. Markets will also react to India’s Q3 GDP data. The auto sector is expected to be in focus as monthly sales numbers will be published over the weekend,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.

Here are key domestic and global market cues for Sensex today:

Asian Markets

Asian markets traded higher on Friday tracking overnight rally on Wall Street and as investors awaited China manufacturing data.

Japan’s Nikkei 225 gained 0.72%, while the Topix index rose 0.50%. Hong Kong’s Hang Seng index futures indicated a lower opening. South Korea markets were shut for the Movement Day holiday.

Also Read: Buy or sell: Vaishali Parekh recommends three stocks to buy today — March 1

Gift Nifty Today

Gift Nifty was trading around 22,197 level, a premium of more than 30 points from Nifty Futures Thursday close, indicating a mildly positive start for the Indian stock market indices.

Wall Street

The US stock market indices rallied, with the S&P 500 and Nasdaq closing at record highs on Thursday led by tech stocks, after the release of inflation data.

The Dow Jones Industrial Average gained 47.37 points, or 0.12%, to 38,996.39, while the S&P 500 rose 26.51 points, or 0.52%, to 5,096.27. The Nasdaq Composite ended 144.18 points, or 0.90%, higher at 16,091.92.

Nvidia shares gained 2.08%, Advanced Micro Devices surged 9.06%, while Dell Technologies share price rose 1.51%. Boeing shares fell 1.59%, while Snowflake slumped 18.14%.

US Inflation

US prices picked up in January, but the annual increase in inflation was the smallest in nearly three years. The personal consumption expenditures (PCE) price index rose 0.3% last month, government data showed. In the 12 months through January, PCE inflation rose 2.4%. That was the smallest year-on-year increase since February 2021 and followed a 2.6% advance in December, Reuters reported.

Economists polled by Reuters had forecast the PCE price index climbing 0.3% on the month and increasing 2.4% year-on-year.

US Unemployment Claims

More Americans applied for jobless benefits last week, but layoffs remain historically low. Applications for unemployment benefits rose by 13,000 to 215,000 for the week ending February 24, the Labor Department said. In total, 1.9 million Americans were collecting jobless benefits during the week that ended February 17, up 45,000 from the previous week and the most since November.

India’s Q3 GDP

India’s gross domestic product (GDP) grew 8.4% during the third quarter of FY24, remaining the fastest-growing major economy in the world. GDP growth for Q1FY24 and Q2FY24 has also been revised upwards to 8.2% and 8.1%, respectively. The FY24 GDP growth estimate has also been revised upwards to 7.6% from 7%.

Read here: India’s Q3 GDP growth at 8.4%, beats D-Street estimates; economy grows at fastest pace in 6 quarters: 5 key highlights

India’s Fiscal Deficit

India’s fiscal deficit during the first ten months of FY24 stood at ₹11.03 lakh crore, or 63.6% of the revised annual estimate, according to data released. The fiscal deficit narrowed from ₹11.91 lakh crore, or 67.8% reported in the same period last year.

Read here: India Apr-Jan fiscal deficit at ₹11.03 trillion, 64% of annual target

US Fed Officials

Atlanta Fed President and voting member Raphael Bostic stressed taking a data-dependent approach to monetary policy, saying it was going to be a bumpy path to the Fed’s 2% inflation target, and repeated his view that he sees the central bank cutting rates “in the summer months.”

Chicago Federal Reserve Bank President Austan Goolsbee said improvements last year in the supply of goods and the labor market paved the way for inflation declines this year, indicating he remains supportive of rate cuts later this year, Reuters reported.

Japan’s Factory Activity 

Japan’s factory activity shrank at the fastest pace in over three-and-a-half years in February.

The final au Jibun Bank Japan manufacturing purchasing managers’ index (PMI) shrank to 47.2 in February from 48.0 in January, its ninth straight month of contraction.

Oil Prices

Crude oil prices fell on Thursday as the US inflation data and rising OPEC production weighed on prices.

Brent futures for April delivery settled at $83.62 a barrel, down 6 cents, while US crude settled at $78.26 a barrel, losing 28 cents.

(With inputs from Reuters)

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Published: 01 Mar 2024, 07:11 AM IST