The Indian stock market is expected to open slightly higher on Tuesday, despite the predominantly weak cues from international markets. However, possible gains may be limited, with market volatility anticipated due to upcoming key U.S. and GDP readings alongside the expiry of derivative contracts for February's series.
On Monday, benchmark indexes Sensex and Nifty both closed down approximately half a percent after a turbulent trading session. The rupee achieved a minor increase, ending 2 paise higher at 82.89 against the dollar.
Asian markets are displaying mixed performance this Tuesday morning. Investors are awaiting vital inflation readings from the U.S. and Europe, which may offer insights on the likelihood of early rate cuts. The Japanese inflation rate has surpassed expectations, causing speculation that the Bank of Japan could end its negative interest rates by April. Consequently, the dollar is currently weak in trading.
Meanwhile, on Monday, Jeffrey Schmid, President of the Kansas City Federal Reserve Bank, gave his inauguration speech. He suggested that the U.S. central bank is not in a hurry to cut interest rates. Gold prices increased marginally while oil prices decreased following a significant overnight rise due to escalating tensions in the Middle East.
U.S. stocks concluded trading on a down note on Monday. Investors are patiently waiting for key economic data, which will be released later in the week, to shed light on the future direction of interest rates. Earlier in the day, data indicated lower than expected sales increases for new single-family homes in the U.S. Overall, the Dow decreased by 0.2%, the tech-heavy Nasdaq Composite fell by 0.1%, and the S&P 500 declined by 0.4%.
On Monday, European stocks also ended mainly in negative territory, apprehensive of forthcoming U.S. and Eurozone inflation data. The pan-European STOXX 600 was down by 0.4%. France's CAC 40 lost half a percent and the U.K.'s FTSE 100 decreased by 0.3%. On the other hand, the German DAX closed with a marginal gain.
