Market may recover after a steep selloff

Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could rise 3 points at the opening bell.

Overseas, Asian stocks were mixed, following last week's market turmoil in the US.

US stocks closed steeply lower Friday, as investors digested the implications of a tighter US monetary policy, flagging global growth and uncertainty surrounding US-China trade relations. US equity market on Monday will end early as it is Christmas Eve and will be closed on Tuesday for the Christmas holiday.

Meanwhile, the US federal government partially shut down for the third time this year early Saturday as lawmakers in Washington continued to wrangle over funding for President Donald Trump's proposed border wall.

Key lawmakers and Trump administration officials returned midday Saturday to resume negotiations over Trump's border-wall funding demand of at least $5 billion. By the middle of the afternoon, Republican Senate Majority Leader Mitch McConnell announced his chamber would adjourn for the Christmas holiday, not returning until 27 December 2018.

Closer home, foreign portfolio investors (FPIs) bought shares worth a net Rs 134.14 crore on 21 December 2018, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 488.55 crore on 21 December 2018, as per provisional data.

Domestic stocks dropped sharply Friday, 21 December 2018, on heavy selling pressure in index pivotals. The barometer index, the S&P BSE Sensex, lost 689.60 points or 1.89% to settle at 35,742.07. The Nifty 50 index lost 197.70 points or 1.81% to settle at 10,754.

On the economic front, India's GST Council in the thirty-first meeting held on Saturday, 22 December 2018, at New Delhi announced reduction in GST rates/exemptions on 23 goods and services, including movie tickets, TV/monitor screens and power banks, and exempted frozen and preserved vegetables from the levy. Of the 23 goods and services on which rates have been slashed, tax rate on seven items in the 28% slab has been brought down. With this, only 28 goods are left in the highest 28% tax bracket. The new GST rates will be effective from 1st January 2019.

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