Market may drop in early trade

Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could fall 57 points at the opening bell. Bharti Airtel will announce Q1 June 2019 result today, 1 August 2019.

Overseas, most Asian stocks were trading lower Thursday after remarks by Fed Chair Jerome Powell dampened expectations for further cuts going forward. The Caixin/Markit factory Purchasing Managers' Index came in at 49.9 for July, from 49.4 in June.

US stocks closed sharply lower Wednesday with investors disappointed that the Federal Reserve cut interest rates in order to cushion the economy from the effects of President Trump's trade war with China, but refrained from suggesting further rate cuts were on the way.

The Federal Reserve on Wednesday trimmed its benchmark fed funds interest rate by a quarter-point, citing muted inflationary pressures and the implications of global developments. The vote was 8-2. The reduction in the fed funds rate - the first since 2008 - drops it to a range of 2% to 2.25%.

At his press conference, Fed chair Jerome Powell added that the Fed has moved to a somewhat more accommodative stance as part of a mid-cycle adjustment as trade tensions seem to be having a significant effect on the economy and the global manufacturing slowdown is a bigger factor than expected last year.

Overnight U.S. and Chinese delegates, including Trade Secretary Robert Lighthizer and Treasury Secretary Steven Mnuchin, reportedly concluded the first round of talks since the G-20 gathering in May without any substantive developments on the tariff front. The United States and China will resume negotiations in Washington in early September.

Back home,the market ended with decent gains yesterday, 31 July 2019 snapping losses in the past two trading sessions. Gains were supported by firmness in metal, auto and banks stocks. The Sensex rose 83.88 points or 0.22% to settle at 37,481.12. The Nifty 50 index rose 32.60 points or 0.29% to settle at 11,118.

The trading activity on that day showed that the foreign portfolio investors (FPIs) sold shares worth a net Rs 1497.07 crore yesterday, 31 July 2019, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 2479.38 crore yesterday, 31 July 2019, as per provisional data.

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