Indian stocks are expected to open weakly on Thursday in response to mixed influences. The U.S. Federal Reserve has indicated the possibility of future rate reductions but also cautioned about heightened inflation and an unpredictable path ahead.
Domestically, collections from the Goods and Services Tax (GST) hit a new high of Rs 2.10 lakh crore in April, demonstrating a year-on-year growth of 12.4 percent, as reported by the Finance Ministry.
In addition, the Ministry of Commerce and Industry data showed that the growth of India's core sector output has decelerated, moving from 7.1 percent year-on-year in February to 5.2 percent in March. However, this still outpaced March 2023's 4.2 percent.
The International Monetary Fund (IMF) has upwardly adjusted its growth forecast for India from the 6.5 percent predicted in January to 6.8 percent.
Asian markets primarily fell this morning and treasury prices remained stable, having risen on Wednesday. Concurrently, the price of gold inched up, as the Fed's stance was perceived as less aggressive than anticipated.
Oil prices recouped some of their value after plummeting to a seven-week low on Wednesday due to adverse inventory data.
U.S. stock prices oscillated but eventually closed slightly higher on Wednesday night, after the Federal Reserve preserved its current rates, referencing the insufficient progress on inflation as a reason to lower interest rates from a twenty-year high.
The Fed also divulged plans to decelerate the reduction of its balance sheet to mitigate tension in the money market.
In terms of economic data, private sector employment rose at an accelerated rate in April, while factory activity shrank in response to declining demand, as per separate reports.
While the Dow Jones saw a slight uptick of 0.2 percent, both the tech-centric Nasdaq Composite and the S&P 500 saw decreases by around 0.3 percent.
Most European markets were closed on Wednesday due to the International Workers' Day public holiday. The FTSE 100 in the U.K. dipped by 0.3 percent.
