Market indices likely to see uptick at opening bell

Trading of Nifty 50 index futures on the GIFT Nifty indicates that the Nifty could rise 37.50 points at the opening bell.

Economy:

The Reserve Bank of India's (RBI) monetary policy committee (MPC) expressed caution regarding inflation, according to the minutes of the MPC meeting released on 22nd February. The committee members, including RBI Governor Shaktikanta Das, highlighted concerns about uncertainty in food prices, citing it as a significant source of volatility for the overall inflation outlook. Governor Das also emphasised that geopolitical tensions and supply chain disruptions could further contribute to inflation risks. Deputy Governor Michael Debabrata Patra emphasized the need for a restrictive monetary policy to maintain downward pressure on inflation while minimising the output costs of disinflation. Governor Das warned that recurring food price shocks could disrupt the ongoing disinflation process, posing risks of de-anchoring inflation expectations and generalising price pressures.

Global Markets:

The US Dow Jones index futures is currently up by 38 points, signaling a positive opening for US stocks today.

Most Asian stocks rose on Friday, contributing to a week of substantial market growth globally. The impressive financial results of AI company Nvidia triggered a surge in record highs across Asia, Europe, and the U.S. However, Japan's Nikkei was closed for a public holiday on that day.

Wall Street achieved record highs on Thursday, driven by a surge in technology stocks, particularly fueled by positive earnings and guidance from NVIDIA Corporation, a prominent AI company. Despite warnings from the Federal Reserve about prolonged higher interest rates, investors remained optimistic. However, weak purchasing managers index readings for February suggested a decline in business activity in the U.S.

The S&P 500 climbed 2.1% to reach a record 5,087.03 points, the Dow Jones Industrial Average rose 1.2% to a record 39,069.11 points, and the NASDAQ Composite outperformed, surging nearly 3% to a record high of 16,041.62 points.

Domestic Equity Market:

The benchmark indices settled higher on Thursday, with the Nifty50 reaching a new high of 22,252.50, propelled by widespread buying across sectors. This upturn came after a negative start, during which the Nifty50 temporarily dipped below 21,900 before staging a rally in the final hours of trading. The market displayed high volatility, largely attributed to the weekly expiry of Nifty50 options. However, the Nifty50 found support at the 21-day EMA on the lower end before surging towards higher levels. IT, auto and metal shares advanced, while banks and financial stocks declined.

The barometer index, the S&P BSE Sensex jumped 535.15 points or 0.74% to 73,158.24. The Nifty 50 index added 162.40 points or 0.74% to 22,217.45.

Foreign portfolio investors (FPIs) sold shares worth Rs 1,410.05 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 1,823.68 crore in the Indian equity market on 22 February 2024, provisional data showed.

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